SHANGHAI, Dec 25 (Reuters) - The China Development Bank (CDB) has been given an initial quota to offer 30 billion yuan ($4.94 billion) of exchange-traded bonds on the Shanghai exchange, the Shanghai Securities News reported on Wednesday.
The impending issuance means CDB will become the first Chinese lender to issue exchange-traded bonds and it marks a major step by Chinese regulators to boost the country’s fledging fixed income market.
Reuters reported last week that the CDB would issue bonds on the exchange for the first time on Dec. 27, a move aimed at building China’s bond market and helping to integrate the interbank market, which is closed to direct participation by ordinary investors.
“The CDB will issue financial bonds on a trial basis as arranged by the People’s Bank of China and the China Securities Regulatory Commission,” the exchange said in a statement published on its website, www.sse.com.cn, late on Tuesday, without giving details of the issuance.
Banking sources have told Reuters that the bank could issue the bonds in batches, and that it would publish a prospectus for the first issue on Wednesday.
In another boost for the bond market, Chinese regulators have moved to ease restrictions on corporate debt issuance to reduce dependence on bank loans, and to reduce the net market impact of new rules cracking down on practices intended to evade lending restrictions. (Reporting by Lu Jianxin and Fayen Wong; Editing by Paul Tait)