Beijing to expand scale of corporate bonds
The mainland will widen companies' access to the corporate bond market as it streamlines the approval procedure and controls risks, a move to provide enterprises an alternative to a stock market listing.
The National Reform and Development Commission will let companies issue debts as long as they meet the regulatory requirements to expand the scale of the corporate bond market, the China Securities Journal reported. It cited an official as saying the NDRC had simplified the approval procedure and allowed qualified companies to issue debts worth 40 per cent of their net asset value.
Many mainland firms are hungry for cash this year as they were forced to delay or scrap initial public offering plans and past monetary tightening policies made it difficult to borrow from banks.
The NDRC has approved issuance of bonds worth 180 billion yuan (HK$204.29 billion) in the first 10 months of this year, exceeding 170.9 billion yuan for the whole of 2007.