68 February marked a significant uptick in debt issuance by Asia-Pacific banks, reaching a four-month high propelled by substantial bond sales from mainland Chinese lenders. According to data compiled by S&P Global Market Intelligence, banks in the region collectively raised $25.01 billion via debt securities in February, showcasing a notable increase from $20.88 billion in February 2023 and $19.03 billion in January 2024. Notably, bonds issued by three major mainland Chinese banks—China Construction Bank Corp., Bank of China Ltd., and Agricultural Bank of China Ltd.—contributed to over 60% of the total debt capital raised by the region’s banks during the month. The surge in issuance by Chinese lenders, particularly the top five designated as global systemically important banks (G-SIBs), is attributed to efforts to bolster capital reserves in compliance with regulatory requirements. Maggie Yee, Director for Investment Consulting at Lighthouse Canton, highlighted that Chinese banks are augmenting their capital buffers to meet regulatory demands, particularly focusing on the issuance of total loss-absorbing capacity (TLAC) bonds mandated by China’s banking regulator to ensure financial stability. Chinese G-SIBs are mandated to maintain a TLAC equivalent to at least 16% of risk-weighted assets by January 1, 2025, and 18% by January 1, 2028. Yee anticipates further significant TLAC bond issuances from Chinese banks in 2024 in line with regulatory obligations. You Might Be Interested In Community Development Alliance Showcases Quality, Entry-Level Homes Central Bank of Nigeria Restricts Banks from International Money Transfer Operations Western Banks Express Concerns Over EU Plan to Seize Russian Assets, Sources Say UAE Removed from Financial Crime Watch List, Signifying Victory for the Nation UK Banks Not Involved in Greece Private Sector Deal, UK Treasury Confirms American Airlines Supports Next Generation of Aviation Maintenance Professionals with Scholarships
