HALISTER1: CORRECT: China Cos Should Repatriate Bond Proceeds, CICC Says

CORRECT: China Cos Should Repatriate Bond Proceeds, CICC Says

(Bloomberg) -- (Corrects headline to show CICC recommends bond proceeds repatriation.)
  • Chinese issuers should grab the mkt window and repatriate offshore bond proceeds back into the country, Zhang Xing, Head of DCM Origination, Overseas, at CICC, says in an interview.
  • On June 15 China’s State Administration of Foreign Exchange (SAFE) opened the gate for corporates to repatriate proceeds of offshore bond issuance and also decide the timing to take the funds onshore
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  • Zhang expects SAFE’s new rule to give Chinese issuers more incentive to tap the USD bond market as most of them need to repatriate proceeds for their onshore projects
  • He expects better rated LGFV issuers to benefit more from the new rule
    • “As the high rated LGFVs are able to get higher international ratings and more favorable deliverable forward price from banks to help lower their hedging cost”
  • China financing vehicles find dollar bond buyers as yuan slides
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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SAOFEZ CH (State Administration of Foreign Exchange)

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