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Is the Rush to Panda Bonds Over?

Following the publication of relaxed regulations, there has been a steady stream of PRC issuers listed offshore looking to tap the local PRC debt markets with “Panda Bonds” issued domestically in the PRC by offshore entities.

This new breed of bonds are attractive to potential issuers as the coupon rate is much lower compared to U.S. Reg. S issues and are structured without a security package.

Demand for these bonds has also been driven by lower interest rates in China, coupled with a desire to hold debt in Renminbi due to the currency’s recent decline against the U.S. dollar. Reports indicate that approximately RMB115 billion in Panda Bonds have been issued from December 2015 to the end of March 2016, a significant portion by Chinese developers. That said, it has not been plain sailing with concerns rising over the protracted regulatory and procedural delays with Panda Bonds, and restrictions on the issuers’ ability to use offshore funds that have been raised domestically.


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Is the Rush to Panda Bonds Over?


Paul Lim

Hong Kong   +852 2842 9551
Mobile  +852 6469 3368

Rowan Wu
Legal Manager

Hong Kong   +852 2842 9554
Mobile  +852 6469 3386

Christopher W.H. Bickley
Partner, Head of Hong Kong Office

Hong Kong   +852 2842 9556
Mobile  +852 6469 3356


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