Demand has surged for shorter-term yuan bonds from local government financing vehicles, led by lower-rated borrowers, in the wake of China’s efforts to stem debt risks in the sector.
Orders for new LGFV notes maturing in less than a year have exceeded issuance by 4.6 times so far this month, which would be a record, according to a report from Huaan Securities Co. The subscription ratio is 3.9 for notes maturing in 1 to 2 years, the highest in nearly a year.
There have been growing concerns about the $9 trillion debt market for LGFVs, which were created to finance infrastructure projects but rarely generate enough returns to cover their obligations. Rising debt and cash-flow issues as China’s economy slows amid the real estate crisis have fueled the worries.
Exemplifying the turn in investor sentiment was last week’s 1.5 billion yuan note sale by an LGFV from Tianjin, one of China’s most indebted cities. The subscription ratio for Tianjin Infrastructure Construction & Investment Group Co.’s deal topped 70, people familiar with the matter said. For all LGFV bond sales from Tianjin province, August’s order rate is at a record 13.6, according to Huaan Securities.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Oil Steady After Weekly Loss on Concern Over Chinese, US DemandOil was steady after its first weekly loss since June, with macroenomic concerns outweighing signs of a tight physical market.
Read more »
China’s Low Births, Weaker Growth Cut Infant Formula Demand, Says A2China’s falling birth rate and sluggish economic recovery are expected to cause a double-digit decline in the country’s infant formula market this financial year, a2 Milk Co. said Monday.
Read more »
Chinese Banks Disappoint With Smaller Lending Rate Cuts(Bloomberg) -- Chinese banks made a smaller-than-expected cut to their benchmark lending rate on Monday and avoided trimming the reference rate for mortgages, despite the central bank putting pressure on lenders to boost loans. Most Read from BloombergBorrowers With $39 Billion in Student Loans Finally See ReliefPutin Turns to Ruble and Ballot to Shore Up Shaken AuthorityRolls-Royce Debuts Droptail Roadster, Priced at Over $30 MillionChina Urges More Loans, Debt Risk Reduction as Woes CompoundAl
Read more »
China’s Low Births, Weaker Growth Cut Infant Formula Demand, Says A2(Bloomberg) -- China’s falling birth rate and sluggish economic recovery are expected to cause a double-digit decline in the country’s infant formula market this financial year, a2 Milk Co. said Monday.Most Read from BloombergBorrowers With $39 Billion in Student Loans Finally See ReliefPutin Turns to Ruble and Ballot to Shore Up Shaken AuthorityRolls-Royce Debuts Droptail Roadster, Priced at Over $30 MillionChina Urges More Loans, Debt Risk Reduction as Woes CompoundAlas, Trump Is Still Eligibl
Read more »
Oil Rises for Third Day as Tighter Market Vies With Demand Risks(Bloomberg) -- Oil rose for a third day as signs the physical market is tightening offset growing demand risks in China and the US. Most Read from BloombergBorrowers With $39 Billion in Student Loans Finally See ReliefPutin Turns to Ruble and Ballot to Shore Up Shaken AuthorityRolls-Royce Debuts Droptail Roadster, Priced at Over $30 MillionChina Urges More Loans, Debt Risk Reduction as Woes CompoundGlobal benchmark Brent traded above $85 a barrel, and is up around 2.5% since the close on Wednesd
Read more »
Chinese Developers Owe $137 Million to Hong Kong Property AgencySeveral Chinese developers owe more than 1 billion yuan ($137 million) in commission fees to property agency Centaline’s mainland China unit, the Hong Kong company said in a statement.
Read more »