IFC to issue record RMB bonds in London

The International Finance Corporation (IFC), a member of the World Bank Group, will issue RMB-denominated bonds worth 1 billion yuan (165 million U.S. dollars) next month in London, announced sources with the IFC China branch in Beijing on Wednesday. The issuance, the largest ever on the London Stock Exchange by a multilateral agency, is aimed at increasing foreign investment in China, according to IFC Vice President Hua Jingdong. It will demonstrate the strong demand from international investors for offshore RMB bonds, while providing an alternative source of RMB funding for investment in China, he said. China has been trying to introduce the RMB into the global market in an unprecedented fashion. It has been pushing the currency through cross-border trade settlement since June, 2009, as its capital account is largely closed. Since that year, China has promoted RMB internationalization with a three-pronged approach: facilitating international trade and investment denominated and settled in RMB, encouraging offshore RMB service centers to develop offshore RMB-denominated financial products, and encouraging central banks to hold the currency as part of their foreign exchange reserves. The IFC pioneered the international issuance of RMB-denominated bonds in China (Panda bonds) and Hong Kong (Dim Sum bonds). It was also first to set up a program to issue offshore RMB-denominated discount notes on regular basis.