A new year and a new landmark on the renminbi’s road to internationalisation. In the highest profile offshore yuan bond to date, the World Bank issued a Rmb500 million ($76 million) dim sum bond in Hong Kong this Wednesday.
The two year issue carried the lowest coupon so far at 0.95% and was lead managed by HSBC. Dim sums are the nickname for yuan-denominated bonds issued in Hong Kong that seek to tap the territory’s offshore renminbi deposit base. The market has taken off in the past few months with McDonald’s and Caterpillar issuing earlier bonds.
Reuters says the timing is no coincidence, with China set to up it shareholding in the World Bank as its third largest stakeholder.
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