Business

Published: Monday February 20, 2012 MYT 9:01:00 AM

Shanghai exchange may launch highyield debt soon report


SHANGHAI, Feb 20 (Reuters) China's Shanghai Stock Exchange may soon launch highyield debt and interest rate swaps, the official China Securities Journal said on Monday, in a move that would increase financing options for smaller companies.

The exchange may also encourage more institutions, including those registered as Qualified Foreign Institutional Investors (QFII), to trade on its debt market, the newspaper said, quoting an unnamed senior brokerage official.

The QFII scheme allows foreign institutions to trade selected mainland China stocks and bonds.

The report gave no timetable or other details. State media reported in early February that Chinese markets may launch a highyielding junkbond market as early as this month or next, a move that could expand access to credit for small, private firms that are largely shut out of China's statedominated financial system.

A highyield bond market would support China's economic growth by providing a muchneeded source of financing to smaller firms, analysts have said.

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