HONG KONG May 11 China's Shimao Property
and Longfor Properties said they had won
regulatory approval to issue medium-term notes in the interbank
market, a refinancing channel local developers are increasingly
tapping to circumvent restrictions aimed at cooling the property
The homebuilders said on Wednesday they had received
approval from the interbank regulator to issue the notes for 8
billion yuan ($1.2 billion) each.
The authorities has been making it harder for real estate
developers to sell bonds at the exchange market, which is
regulated by the China Securities Regulatory Commission (CSRC)
since the second half of last year as part of measures to rein
in property prices, driving companies to the dollar bond market.
According to the interbank regulator National Association of
Financial Market Institutional Investors (NAFMII), some of the
Chinese developers who have applied to issue medium-term notes
include China Resources Land, China Vanke
and COFCO Property and Gemdale Crop
"Developers are tapping the interbank market now because the
bond exchange market is completely closed," said an executive at
one developer who declined to be named due to company policy.
Interest rates for the interbank bond market are slightly
higher than the corporate bond exchange, the executive added.
Earlier this year, Beijing-based Sino-Oceran Group
completed in March the issue of first tranche 2017 medium-term
notes totalling 4 billion yuan at coupon rates of 4.77 percent
and 5.05 percent, and China Jinmao Holdings issued 2.5
billion yuan notes at 4.65 percent in April.
($1 = 6.9020 Chinese yuan renminbi)
(Reporting by Clare Jim; Editing by Miral Fahmy)