China Economic Scan Weekly Debt Market Review – 23 May 2009

China Economic Scan Weekly Debt Market Review – 23 May 2009

23/05/2009. Source: China Economic Scan. Callum Thomas, Managing Director, China Economic Scan

The CSI Enterprise Bond Index started the week at 117.81 and climbed steadily to a high of 118.08, before closing the week at 118.04. The Shenzhen Corporate Bond Index started the week at 130.59, climbed to a high of 130.78, and closed the week at 130.77

Agricultural Bank of China (ABC) raised 50 billion yuan ($7.3 billion) in the nation’s biggest corporate bond sale to boost capital as part of preparing for an initial public offering (IPO). ABC sold 25 billion yuan of 10-year callable bonds at a coupon rate of 3.3% for the first 5 years and 25 billion yuan of 15-year bonds at 4% for the first 10 years on interbank market.

Shenzhen Development Bank is planning to issue up to RMB 1.5 billion in 15-year bonds on May 26, sources reported. Dagong Global Credit Rating Co has rated the bonds AA-, and Haitong Securities and UBS Securities have been assigned as major underwriters for the issuance.

China's Ministry of Finance (MOF) said it would issue 27.3 billion yuan ($4 billion) of three-year book-entry treasury bonds, the ninth batch of its type this year. The bonds have a fixed annual interest rate of 1.55% and will be sold from May 21 to 25.

The MOF issued a total of 28.5 billion yuan of local government bonds in the first half of May on behalf of 6 local governments, which would include Dalian city, Sichuan province and Hubei province.

Finally, Chinese oil giant, PetroChina said it will buy 8 gas suppliers from its parent company, CNPC, and issue 26 billion yuan in medium-term notes.

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