CNH Tracker-Heavy dim sum supply seen next year on refinancing pressure

By Michelle Chen

HONG KONG, Dec 12 (Reuters) - A strong month of yuan bond

supply in the offshore market in November is likely to extend

into next year as more than half of the outstanding yuan debt in

Hong Kong is set to mature in 2014.

Outstanding yuan bonds in the former British colony amount

to around 560 billion yuan ($92 billion), of which more than 300

billion yuan will mature within the next 12 months, prompting

some issuers to raise funds earlier to avoid a possible

liquidity squeeze.

Indeed, the primary market saw 48 billion yuan worth of bond

issuance in November, the highest level since June 2012, and saw

issuers such as Ping An Insurance Overseas and Far East Horizon

revisiting the so-called dim sum bonds.

"Issuance will be active in the first quarter of next year

when redemption is usually strong due to seasonal factors, while

the NDRC also started to approve new quotas to mainland

issuers," said Becky Liu, a senior rates strategist at Standard

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