Dim sum bonds are
bond
Bond or bonds may refer to:
Common meanings
* Bond (finance), a type of debt security
* Bail bond, a commercial third-party guarantor of surety bonds in the United States
* Chemical bond, the attraction of atoms, ions or molecules to form chemica ...
s issued outside of China but denominated in
Chinese renminbi
The renminbi (; symbol: ¥; ISO code: CNY; abbreviation: RMB) is the official currency of the People's Republic of China and one of the world's most traded currencies, ranking as the fifth most traded currency in the world as of April 20 ...
, rather than the local currency. They are named after
dim sum, a popular style of cuisine in southern China.
History and use
The first dim sum bond was issued by the
China Development Bank in July 2007. Until July 2010, only Chinese and Hong Kong banks could issue renminbi-denominated bonds;
led to the development of an offshore market in renminbi and the internationalization of dim sum bonds.
The bonds became more popular as foreign companies sought yuan-denominated assets as the renminbi
appreciated in 2011. Although the major market for dim sum bonds is Hong Kong,
China Construction Bank
China Construction Bank Corporation (CCB) is one of the " big four" banks in China. In 2015, CCB was the 2nd largest bank in the world by market capitalization and 6th largest company in the world. The bank has approximately 13,629 domestic branc ...
became the first Chinese Bank to issue a renminbi denominated bond in London in November, 2012. This followed similar issues by non-Chinese banks like
ANZ,
HSBC and
Banco do Brasil
Banco do Brasil S.A. ( en, Bank of Brazil) is a Brazilian financial services company headquartered in Brasília, Brazil. The oldest bank in Brazil, and among the oldest banks in continuous operation in the world, it was founded by John VI, King ...
earlier in the year.
35.7 billion yuan in dim sum bonds were issued in 2010 and 131 billion in 2011.
The first foreign-issued dim sum bond by a nonfinancial company was announced on August 19, 2010 and issued on September 16, 2010 by
McDonald's
McDonald's Corporation is an American multinational fast food chain, founded in 1940 as a restaurant operated by Richard and Maurice McDonald, in San Bernardino, California, United States. They rechristened their business as a hambur ...
.
On 5 November 2013,
British Columbia
British Columbia (commonly abbreviated as BC) is the westernmost province of Canada, situated between the Pacific Ocean and the Rocky Mountains. It has a diverse geography, with rugged landscapes that include rocky coastlines, sandy beaches, ...
finance minister
Mike de Jong reported a successful placement of Chinese RMB$2.5bn in dim sum bonds, listed January 14, 2014 on the
Luxembourg Stock Exchange
The Luxembourg Stock Exchange, LuxSE (french: Bourse de Luxembourg) is based in Luxembourg City at 35A boulevard Joseph II.
The chairman of the board is Alain Kinsch and the chief executive officer is Julie Becker.
The exchange has pre-opening ...
. The issue was five times oversubscribed.
Some Indian companies participate in the dim sum bond market, one of them being IL & FS Transportation networks (a subsidiary of the giant lender
IL & FS Financial Services).
See also
*
Foreign currency denominated bond
*
Panda bond
*
Kungfu bond
*
Eurobond
*
Schengen bond
Sources
{{reflist
Bonds in foreign currencies
Renminbi