Baoshan Iron And Steel Co., Ltd. Was Awarded The First Yuan To Hong Kong To Issue RMB Bonds &Nbsp, With A Quota Of 6 Billion 500 Million Yuan.

The day before yesterday (October 20th), the state

Related analysts pointed out that Baosteel's first wholesale debt is a good news for Hongkong's offshore RMB market and RMB internationalization.

Baosteel was granted 6 billion 500 million bonds

Yesterday, the national development and Reform Commission announced on its website that "Jing"

Before that, the number of offshore RMB bonds issued in Hongkong was large, but most of them were overseas subsidiaries of mainland financial institutions and domestic enterprises.

There are also international organizations and overseas enterprises.

In August this year, Vice Premier Li Keqiang announced that it would increase the main body of domestic institutions issuing RMB bonds in Hongkong, allowing domestic enterprises to issue Renminbi bonds in Hongkong.

Wang Haoyu, deputy director of the first pioneering Securities Research Institute, told the daily economic news reporter that this will enrich the variety of offshore RMB market in Hongkong and play a great role in the prosperity of the offshore RMB market in Hongkong.

The choice of Baosteel, "it may be to see this kind of large enterprise credit risk is better."

Financing channels or increase

Since the beginning of this year, the financing of mainland enterprises is also a relatively big issue. Can the introduction of this policy become a new direction of financing for mainland enterprises?

Wang Haoyu said that the financing cost in Hongkong is relatively low, which will attract more mainland enterprises.

The current interest rate of RMB deposits in Hongkong is relatively low, most of which are at 0.3%~0.5%.

In August of this year, Hongkong HSBC also announced that it would cut interest rates on RMB deposits above RMB 5000 and deposit interest rate from 0.45% to 0.25%.

The issuance rate of RMB bonds issued in Hong Kong is generally low.

In June this year, Ping An holding company issued a three year bond interest rate of 2.075%, while the mainland's general three year loan interest rate was about 6.1%.

At the same time, Hongkong's increasing Renminbi deposits also developed pools of funds for mainland enterprises.

Data from the Hongkong monetary authority showed that as of the end of August, Hongkong's RMB deposits reached 609 billion yuan.

Since the first half of this year, offshore renminbi bonds in Hongkong have been developing rapidly due to the mainland's credit crunch and the cost of issuing bonds.

According to Chen Delin, President of the Hongkong monetary authority, the circulation of RMB dim sum bonds has exceeded 85 billion yuan in the first 9 months of this year.

But Wang Haoyu also said that although this has indeed expanded the financing channels for domestic enterprises to some extent, in particular, this bond is not an issue that enterprises want to send, but also depends on the specific practices of the government.

The government still wants to push forward the development of offshore RMB market in Hongkong.

Help build offshore market in Hongkong

"This is a good direction for development."

Kuang Minbin, chief operating officer of Kai Ji securities, told the daily economic news reporter that the growth of offshore RMB bonds in Hongkong began to slow down some time ago, mainly because there were not many outlets for the renminbi and too few investment vehicles.

Since September this year, the offshore RMB bond market has begun to fluctuate.

The RMB offshore bond index of Bank of China Hongkong (02388.HK) was 19 daily 94.87 in October, and the cumulative yield this year is -5.13%.

And from the beginning of this year to the end of August this year, the index has been above 100 points.

Kuang Minbin said that this is mainly influenced by market speculation factors, and the expectation of RMB appreciation is somewhat weakened, worrying that China's economy will slow down.

Kuang Minbin said that the RMB can not invest in many tools, the yield is not too attractive, and now we need to increase investment tools.

If more state-owned shares are allowed to issue Renminbi bonds to Hongkong in the future, it will help to expand the offshore RMB bond market in Hongkong.

Wang Haoyu said that this policy has increased the variety of offshore RMB market in Hongkong, and the prosperity of RMB offshore market is conducive to the internationalization of RMB. This may also be a test for full convertibility under capital terms.