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S&P Global wins permission to rate China’s domestic bonds

Standard_and_PoorsChina’s central bank has given S&P Global the nod to rate its domestic bonds – a first for a company wholly owned by an international credit ratings agency.

The New York-based company said it has been authorised to rate issuers and issuances from financial institutions and corporates, structured finance bonds and Renminbi denominated bonds from foreign issuers, also known as Panda bonds.

The move is part of wider efforts by Beijing to meet foreign investor demand for some yuan-denominated assets and drive up the rating quality in China, according to the People’s Bank of China.

"This approval is the latest step in an ongoing, thoughtful dialog with China's regulators about the future they envisage for their financial markets," said John Berisford, president at S&P Global Ratings. 

He added: "We have been very encouraged by the strong interest from our existing cross-border issuers in our new domestic business, and in the initial phase we will work closely with these same issuers towards ratings for their domestic Chinese debt”.

China’s economic growth has slowed to levels not seen since 1990 amid efforts by Beijing to get high levels of debt under control and the trade war with Washington.

S&P Global (China) Ratings will comment further during the fourth quarter earnings call, which is due to take place on February 7, 2019.

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