More precious metal investment demand
Portfolio February 19th, 2010
Mitsubishi Financial to issue yuan bonds
Mitsubishi UFJ Financial Group Inc., Japan’s largest bank, plans to become the first foreign company issuing yuan-denominated bonds to be sold in China to seek new investors.
Noriyuki Tanaka, manager of corporate planning division, explains subsidiary Bank of Tokyo-Mitsubishi UFJ (China) Ltd. won permission to sell bonds. Also plans to explore funding to 1 billion yuan (U.S. $ 146 million) of securities 2-year term.
“We’re hoping to get a warm reception from investors in China. Yuan bond issuance is the form of diversification of funding sources and stability in the medium term,” Tanaka said by phone from Shanghai today.
Head of the China Securities Regulatory Commission affirmed the Shang Fulin China will develop corporate bond markets and encourage banks to trade debt securities. Previously, the National Association of Financial Market Institutional Investors explain Asian companies were allowed to start selling bonds.
China bonds jumped to 1.96 trillion yuan last year, from 981 billion yuan over the government’s efforts to reduce dependence on bank credit companies.
John Cheng, managing director of investment banking China International Capital Corp., argues that the first group of buyers in China’s bond market could come from blue-chip companies who want to expand.
“Sales of yuan bonds that can be regarded as a pilot project. More importantly, who would buy. Because the insurance and fund managers can not buy because they have to get permission first. The possibility that banks could only buy,” said Qu Qing, an analyst with fixed -income Shenyin Wanguo Securities Co. in Shanghai responded to the plan of the Bank of Tokyo-Mitsubishi.
