Asia round-up: boiling point

Author: Brian Yap | Published: 28 Jun 2017
Chinese capital markets are heating up

A combination of a depreciated Chinese currency and crackdown on speculation on real estate has, among other things, pushed Chinese companies to tap the international high yield bond market. But, when IFLR reported in late April on the influx of PRC issuers – a growing number of whom are local government-owned entities based in third or fourth-tier cities – issuing high yield dollar paper offshore, the country's regulators had not publicly responded to potential default concerns. Only the Shenzhen branch of the National Development and Reform Commission (NDRC) was reported to have required corporates based in Shenzhen raising mid-to-long-term offshore dollar debt to submit credit ratings reports issued by Moody's, S&P or Fitch as supplementary documentary evidence.

The regulators, however, have recently begun to take a hard line with issuers, especially those which have failed to pre-register with them for offshore bond issuances and...