Chinese commercial banks dramatically increased their issuance of subordinated debt in 2019 in a bid to boost their capital standing.
Data from Golden Credit Rating indicates that Chinese commercial banks issued nearly 1.6 trillion yuan in bonds in 2019. This included 1.17 trillion yuan in subordinated debt, for a YoY rise of 191% compared to the 400.72 billion yuan issued in 2018.
China’s regulatory agencies gave strong encouragement to financial institutions to issue subordinated debt last year to bolster their capital levels, spurring a major drive amongst large-scale commercial banks as well as small and medium-sized lenders.
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