Panda Bond Sales Surge in First Half 2016 as Costs Sink on Weaker Yuan

(Beijing) – The value of panda bonds issued in the first six months of 2016 was more than double that issued in the whole of last year due to a fall in financing costs, but barriers including regulatory uncertainties on capital repatriation have kept potential issuers away from the market, JPMorgan Chase & Co. said.

From January to July 5, the amount of panda bonds, or yuan-denominated bonds issued by foreign entities on the mainland market, reached 29 billion yuan, according to a report published last week by the financial services provider. Only 12 billion yuan worth of bonds were sold last year and less than 5 billion yuan worth of bonds were issued each year from 2005, when the market was established, to 2014, the report showed.