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RMB Devaluation Is Difficult To Stop People From Investing In Dim Sum Debt.

2014/4/6 13:51:00 28

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"at present, according to the calculation of the underwriting amount of offshore a href=" http://www.91se91.com/news/index_s.asp "> RMB > /a > bond issuance, DBS Bank (market area) has ranked third.

In April 3rd, Lin Shuhui, chief financial officer of DBS bank, told an exclusive interview with reporters that DBS's competitive advantage lies in its strong bond distribution capabilities.

Offshore renminbi bond issuance is expected to total 300 billion yuan this year.

with this year's .

the depreciation of RMB in the first quarter, a researcher from a foreign investment bank in Shanghai said that the rate of return on arbitrage in renminbi has now fallen to around -5%.

Even so, Lin Shuhui believes that at present, overseas financial institutions are still fully interested in Renminbi spot debt and are still in a state where demand exceeds supply.

relying on distribution ability /p >

reporters learned that DBS bank ranked twentieth in 2012 in terms of the amount and amount of offshore RMB bonds underwritten.

As of the first quarter of this year, DBS bank has risen to third place, behind Standard Chartered Bank and HSBC.

in Lin Shuhui's view, the ranking of DBS bank is coming from behind. The important advantage lies in its strong distribution ability.

In March this year, DBS bank, as the leading underwriter of China Eastern Airlines (market share trading point), helped Dong Hang overseas (Hongkong) limited issue a 2 billion 500 million and 3 year RMB dim sum debt.

In January, DBS also served as an independent account manager of the offshore RMB bond of 2 billion yuan.

DBS P has strong customer resources in the Asian region, regardless of the first or two tier market.

The sales team maintains close contacts with many Asset Management Co.

It includes not only well-known investment companies, but also private investors with low profile but strong backgrounds.

She said.

For example, the sales team can thoroughly understand the needs of fund managers, and fully communicate the investment stories of debt issuing enterprises with investors.

this is enough to meet the financing needs of companies that face cash shortages and are constrained by local high financing costs while having the opportunity to get loose offshore RMB bond policy support.

Because these companies tend to issue offshore renminbi bonds, which can use offshore renminbi bonds to finance products and services from overseas markets, and can also be used to repay foreign debt.

in the above Eastern Air dim sum debt, the subscription amount is close to 4 billion 300 million RMB, with a total of 92 accounts, of which 99% of Asian investors and 1% of European investors.

From the perspective of investor type, 51% are banks, 26% are Asset Management Co, 12% are private banks, 8% are sovereign investment / agents, and the remaining 3% come from enterprise funds.

despite the recent weakening of the renminbi and the occurrence of some default risk events in the domestic bond market, Lin Shuhui said the offshore RMB bond market will continue to be active this year.

Generally speaking, overseas investors' demand for Renminbi denominated goods still exceeds supply.

"because most of the demand for overseas renminbi is increasing, most of the demand comes from trade. Taking Singapore as an example, after RMB clearing capacity, RMB's trade financing demand growth rate reached 25% in 2013, and the total Singapore total increased to 300 billion yuan."

She said.

RMB arbitrage returns -5% /p >

When p entered into 2014, the sudden devaluation of RMB made many overseas financial institutions unprepared.

In the first quarter of this year, the spot depreciation of the renminbi decreased by 2.64%, especially in February.

Reporters learned that overseas investors have gradually removed the expectation of RMB appreciation from the considerations of investment point debt.

recently, the data collected by Morgan Stanley and Depository Trust and Clearing Corp showed that in 2014, in the investment of RMB appreciation of RMB in the scale of 332 billion US dollars, the total loss of the Chinese company in the benchmark long-term contract investment of US $150 billion was RMB $5 billion 500 million.

"now the rate of return of RMB as arbitrage currency is the worst stage."

A foreign investment analyst in Shanghai told reporters that the current rate of arbitrage in Renminbi is about -5%, and that the rate of appreciation of the RMB is up to 5% at the end of 2013 to January this year, when the arbitrage of RMB is the most profitable stage.

Lin Shuhui served as managing director of DBS < a href= "http://www.91se91.com" > /a < /a > risk management department for 6 years.

From the point of view of risk management, she said, first of all, against the fluctuation of RMB exchange rate, the management of DBS bank and the board of directors had agreed in advance to manage the < a href= "http://www.91se91.com" > paction < /a > within a certain range of fluctuation.

secondly, for customers, DBS bank will help customers monitor accounts and hedge risks.

"This will not carry out speculation in large pactions to ensure that enterprises are in a certain risk range."

She said.

"P > but Lin Shuhui believes that the RMB will still have a tendency to appreciate from a long term demand, but the range of volatility will be greater.

Judging from the current market situation, the interest of the institutions in Renminbi debt is still sufficient, and the demand is greater than the supply.

Last year, the global offshore RMB bonds issued amounted to 263 billion yuan in P.

In the first two months of this year, the figure has reached 107 billion yuan.

DBS bank predicts that by the end of this year, this figure will exceed 300 billion yuan.

In addition, RMB bonds issued before 91 billion yuan will be refinancing this year to provide continuous supply for the market.

"the circulation in the first two months has reached 50% last year, so the demand for the market is still very sufficient, even though the impact of the depreciation of the RMB has not been great impact on the market."

Lin Shuhui thinks.

the above foreign capital analysts said that from 2009 to the present 5 years, the net liabilities of Chinese enterprises from overseas a href= "http://www.91se91.com/news/index_s.asp" > financing < /a > are about 1 trillion and 500 billion US dollars. If the RMB continues to depreciate significantly, the solvency of enterprises will decline and the cost of reimbursement will rise sharply.

Therefore, in order to keep pace with financial reform, the RMB needs to increase the range of fluctuation, and it does not necessarily need to continue to depreciate.