Asset managers call for RMB market standard

Author: Ashley Lee | Published: 16 May 2013
  • Asset managers have called for issuers and bankers to maintain best practices in the nascent dim sum bond market;
  • They encouraged issuers to get their deals rated, both for transparency and to clarify pricing;
  • While credit enhancement structures are popular, asset managers are sceptical of whether they're enforceable in a default situation.

Asset managers have voiced concerns about the proportion of unrated bonds in the dim sum market as well as new credit enhancement structures.

The offshore renminbi market is a nascent market. But panelists at last week's Euromoney Conferences Global Offshore RMB Funding Forum, stressed that more transparency would lead to broader investor participation.

The global hunt for yield has prompted a loosening of covenents in Asia-Pacific debt amid increased demand. But investors are advised to remain selective in their issuer analysis.

Market participants have urged issuers to include the appropriate covenants, rate bonds and generally follow market best...