Financial institution secures largest Panda Bond since 2018's end, contributing nearly 20% of all Renminbi bond issuance by European entities since 2005.
Leading Bank Secures Largest Panda Bond Issuance in Four Years
A prominent international bank has made history in the Chinese interbank bond market, raising RMB 3 billion (approximately $415 million) via a 2-year Senior Preferred note. This marks the largest panda bond issuance by a financial institution since 2018, and it is the third such issuance by the bank this year.
The bank's success in the panda bond market is not new. For the past four consecutive years, it has been the leading foreign bank for NAFMII-registered bonds in the China interbank bond market, including local and panda bond issuers. The National Association of Financial Market Institutional Investors (NAFMII) is a self-regulatory organization that promotes the development of China's Over-The-Counter (OTC) market.
The latest panda bond issuance was approved by China's interbank bond market (CIBM). The transaction attracted an order book of over 8 billion renminbi (approximately $1.1 billion), demonstrating strong interest from European and Emerging Market issuers looking to tap into the panda bond market.
The proceeds of this transaction will be used for general business activities and development. The bank's successful panda bond issuance in the first three months of 2023 brings the total issuance to RMB 61 billion (approximately $9.2 billion). The aggregate principal amount for the bank's panda bond issuances, under the pre-approved program by the People's Bank of China, can be up to 8 billion renminbi (approximately $1.13 billion).
The bank's CEO for Asia Pacific, Europe, Middle East & Africa (EMEA) and Germany, and Member of the Management Board, Alexander von zur Muehlen, stated that the bank is proud of its longstanding track record of driving international participation in China's onshore bond market. The bank's website continues to play an active role in supporting the internationalization of the RMB and continuous opening-up of the capital markets in China.
The panda bond market has seen historic levels of issuance in 2023, and activity is expected to continue throughout this year. This trend underscores China's efforts to liberalize its financial markets and increase the international use of the Renminbi, with yields on panda bonds falling and demand expanding among both Chinese and overseas investors.
Panda bonds, RMB-denominated bonds issued by foreign institutions in China, have surpassed 1 trillion yuan cumulatively with more than 90 issuers, including governments, development banks, and multinational corporations. These bonds have become a crucial channel for international RMB financing and China’s capital market integration.
Two other significant players in the internationalization of the Renminbi and China's capital markets are the Asian Infrastructure Investment Bank (AIIB) and Morgan Stanley. The AIIB's repeated panda bond issuances have raised a combined total of CNY 16.5 billion (approximately $2.3 billion) since 2020, helping provide high-quality RMB-denominated assets to the Chinese bond market and diversify investor bases. Morgan Stanley’s entry into the panda bond market marks a significant milestone in opening China’s interbank bond market to U.S. financial institutions.
In July 2025, the AIIB issued CNY 2 billion (approximately $278.8 million) in panda bonds, which was oversubscribed by more than three times, reflecting strong investor confidence. Morgan Stanley became the first U.S.-headquartered company to issue panda bonds, raising the same amount, CNY 2 billion (approximately $278.7 million) with a five-year maturity and 1.98% coupon rate in the same month.
These issuances highlight the expanding role of global financial institutions in the internationalization of the RMB and liberalization of China’s capital markets through panda bond offerings. The growing issuance and investor enthusiasm for panda bonds underscore their importance in China’s efforts to liberalize its financial markets and increase the international use of the Renminbi.
The leading bank's successful 2-year Senior Preferred note issuance, totaling RMB 3 billion, notably bolsters the capital markets by marking the largest panda bond issuance by a financial institution since 2018. The bank's prominent role in capital markets is also underscored by its status as the leading foreign bank for NAFMII-registered bonds in China's interbank bond market.
