Latest RMB investment news
A new group of investors is set to arrive in China's bond market as index providers prepare to include Chinese bonds in their benchmarks. But these new entrants will likely follow the path set by institutional investors in China, sticking with government bonds and short-dated paper, according to BNP Paribas.
China's onshore dollar bond market could provide an alternative to quota-based outbound investment schemes, allowing banks a novel way of deploying their dollar deposits, according to a senior trader at BNP Paribas.
In the second of a four-part series of articles on China’s financial transformation, GlobalRMB considers the nation’s banking reforms, which will allow a horde of foreign banks to gain more traction in the country. At the same time, Chinese banks are moving in the opposite direction.
China’s startling transformation continued last year, with the opening up the domestic bond market to foreign investors, the rise in renminbi volatility, and an all-important party meeting that cemented the power of Xi Jinping. Over the course of four in-depth articles, GlobalRMB will examine the key themes that will define this transformation in 2018. First up: the move to bring more foreign bond investors into the country.
The week in renminbi: China sets date for oil futures launch, Philippines wins approval for Panda debut, offshore investors hold more Chinese bonds
China unveils plans to kick start RMB-denominated oil futures next month, the Philippines gets regulatory greenlight for its Panda bond issuance, and foreign ownership of bonds in the interbank bond market rises again in January.
Renminbi bullishness has served Luxembourg well. The tiny country has enjoyed substantial China-related fund flows in 2017, largely thanks to a wider offering of investments, Marc Andre Bechet, director of legal and tax at the Association of the Luxembourg Fund Industry (Alfi), told GlobalRMB.
China and the UK have still not announced the launch date of the London-Shanghai Stock Connect, but international investors are already positioning themselves to get the most out of the new link, Gary O’Brien, a senior custody banker at BNP Paribas, told GlobalRMB.
China’s Panda bond market looks set to spring to life this year, with long-awaited guidelines said to be coming within the next two weeks. GlobalRMB takes an in-depth look at the potential for Panda bonds — and the hurdles that need to be cleared.
Germany's domestic central bank said this week that it would start buying renminbi assets. Andreas Dombret, a member of the board at the Bundesbank, indicated to GlobalRMB that the central bank — like others in the developed markets — would follow the European Central Bank’s small initial allocation to the currency.
With growing demand for overseas investment, Chinese regulators could release new outbound investment quotas in 2018 by rebooting the qualified domestic institutional investor (QDII) programme and launching a two-way ETF Connect with Hong Kong.
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Latest news by market and league table performance
GlobalRMB Panda Bonds league table
|Rank||Arranger||Share % by Volume|
|1||China Merchants Securities Co||18.04|
|2||Agricultural Bank of China (ABC)||15.83|
|4||China CITIC Bank Corp||14.25|
|5||Industrial and Commercial Bank of China (ICBC)||11.08|
Panda Bond Database
|Pricing Date||Issuer||Country||Size Rmb (m)|
|1||23-Apr-18||CAR Inc||Hong Kong||730|
|2||11-Apr-18||China Jinmao Holdings||China||3,000|
|3||11-Apr-18||Global Logistic Properties via Iowa China Offshore Holdings||Hong Kong||1,200|
|4||04-Apr-18||China Resources Land||China||4,000|
|5||03-Apr-18||Global Logistic Properties via Iowa China Offshore Holdings||Hong Kong||4,000|
Offshore RMB Bond Top Bookrunners
|Rank||Bookrunner||Share % by Volume|
|1||Standard Chartered Bank||31.68|
|3||Bank of Taiwan||5.50|
|3||Cathay United Bank||5.50|
|5||Societe Generale Securities Services||4.77|
Latest Offshore RMB Bonds
|Pricing Date||Issuer||Country||Size Rmb (m)|
|2||19-Apr-18||Shui On Development (Holdco for Shui On Land)||China||600|
|3||10-Apr-18||Bank of China Taipei Branch (BOC Taipei)||China||3,000|
|4||27-Mar-18||Daimler International Finance||Germany||1,000|