Northeast Asia

The budding Chinese non-performing loans securitization market recorded its fourth transaction in little more than two months with Agricultural Bank of China (ABC) completing a Rmb3.06bn ($462m) offering — the largest on record since the asset class restarted this year.

Call me old-fashioned, or just plain old, but I have a hard time understanding the modern obsession with phones. And I cannot help but feel sorry for those who just can’t free themselves from the shackles of technology — even when they want to.

Despite the technical challenges, it seems likely that People’s Bank of China (PBoC) will give the green light to a bond denominated in IMF special drawing rights (SDR) before the G20 summit in early September.

Clearstream is looking to better connect global investors to China’s interbank bond market (CIBM) with a link set to launch in October. The firm is also working on a joint venture (JV) with the China Foreign Exchange Trading System (CFETS) to launch a bond exchange in Europe, GlobalRMB has learned.

The World Bank is preparing to sell the first bond dominated in the IMF special drawing rights (SDR) unit of account, according to market sources.

The Brics New Development Bank (NDB) executed a landmark trade on July 18, making its capital markets debut with a Rmb3bn ($450m) bond in China. But when even the authorities have trouble knowing whether to classifying it as green or Panda debt, it is clear the need for unambiguous and official bond regulation is long overdue.

Greenland Hong Kong and China Railway Group opened books for their respective dollar bonds on Thursday after meetings with investors earlier this week.

China is continuing its push to establish the renminbi as an investment currency by opening up its private fund industry to wholly foreign-owned firms. While this is likely to spark plenty of interest, market participants said foreign asset managers need to be ready to launch even before registering for a licence.

The renminbi is joining the IMF special drawing rights (SDR) later this year, but that achievement does not mean mission accomplished for China’s authorities. For Beijing to achieve its stated goals of making the RMB a reserve currency and the SDR a real world currency more steps will be needed, according to leading monetary policy experts.

Electronic broker Icap launched the first offshore renminbi (CNH) FX benchmark based on market trading, the first said on July 7. The new fix, which is priced at the open of European markets, aims to fill the gap between Asian trading sessions.

A new index series created by Thomson Reuters and licensed to the Hong Kong Exchange (HKEX) is aiming to become the renminbi equivalent of the widely used DXY dollar index, one of the series’ creators at Thomson Reuters told GlobalRMB.

With the first institution officially through the door of the new China interbank bond market (CIBM) access scheme, market participants are now scrutinizing the CIBM rules and how they will play out. The outlook is positive but investors should beware the small print.