AgBank adds traders for dim sum sales
ABC International, a unit of the mainland's third-largest bank, plans to hire more traders for yuan bonds in Hong Kong, expecting issuance to rise further after tripling in two years to a record last year.
The overseas investment banking arm of Agricultural Bank of China is seeking a bigger share of the so-called dim sum debt market after climbing to the fifth rank among underwriters this year from tenth last year.
Yuan debt sales, excluding certificates of deposits, are set to surpass last year's 112 billion yuan (HK$138 billion), the mainland lender predicts.
"Our primary market business has pretty good momentum now, so we wish to build up our secondary trading capability," said Richard Zhang, ABC executive director of global capital markets in Hong Kong.
Beijing appointed yuan clearing banks in Taiwan and Singapore in the past two months to promote the currency's use in global trade.
The average yield for dim sum company debt was 4.12 per cent, compared with 5.01 per cent in onshore market and 2.72 per cent for global corporates selling debt in dollars, according to Bank of America Merrill Lynch indexes. Investors have stepped up bets on yuan appreciation as the mainland's economy recovers, boosting the appeal of holdings in the currency.
The yuan will strengthen 2.2 per cent this year to 6.1 per US dollar, according to the median estimate in a Bloomberg survey of analysts.