HONG KONG'S chief monetary official yesterday welcomed a call for China's state-run firms to float more bonds in the territory. Hong Kong Monetary Authority chief executive Joseph Yam said a new wave of bond issues from the mainland could buoy the territory's debt market. He was responding to a proposal made yesterday by People's Bank of China vice-governor Chen Yuan. The two officials gave speeches and answered questions at the opening of a two-day conference on China-Hong Kong financial relations after the handover in 1997. Mr Chen said the territory's bond market had lagged behind its banks and stock market, and the demand for bonds exceeded the supply offered by institutions wary of debt. Bonds issued by state-run firms from the mainland probably would be well-received by investors in such an environment, he said. Mr Yam agreed with Mr Chen's observation about Hong Kong's bond market and, noting the demand for investment vehicles created by the territory's pension system, extended an invitation for more debt issues and said no additional regulations would be required for that process. 'There's no need to issue more rules on state-run enterprises because the investors will know how to evaluate the investment risk,' Mr Yam said.