BEIJING, April 9 (Xinhua) -- Issuers of more than 1,100 bonds have adjusted up the coupon rates of their bonds in China since March this year, reported 21st Century Business Herald Thursday.
The figure significantly outran the number of bond issuers which have slashed their bonds' coupon rates in the same period, with coupon rates of three bonds even being adjusted up by more than 400 basis points (bp).
Analysts attributed the phenomenon to the tightening financing environment in China, saying that the last time the same phenomenon appeared was in 2019.
Statistics with Zhongtai Securities showed that the coupon rate hikes of 1,186 bond products stayed 50 bps to 200 bps.
In real estate industry, bond coupon rate hikes prevailed this year due to spurred financing demand after the regulatory policy changes in China.
As a matter of fact, this bout of bond coupon rate hike started as early as in the fourth quarter of 2020 and began to get more obvious this year, said market players, adding that issuers were surely unwilling to increase financing costs but they had no other choice because of the pending valid period of the put provision of their bonds, in particular for the capital intensive real estate sector.
Currently, the turning point of the overall liquidity conditions in China has emerged and it is unlikely for the 2020 monetary policy to continue in the following months, noted the market players, suggesting that enterprises shall reserve enough capital to prepare for possible liquidity tightening. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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