Course overview
Offshore RMB bonds, better known as dim sum bonds (DSB) or CNH, have seen explosive growth in the last 12 months and garnered great interest from International Issuers and Investors alike. This course looks into the reasons behind the growth, key issues surrounding current policies, market developments and why
this could potentially be a new G4 bond market.
This course is for:
- Issuers that are trying to take advantage of this fastest growing global capital market to broaden
their funding sources
- Central Banks
- Sovereign Wealth Funds and policy makers that need to understand better the benefitswhich the RMB bonds brings to the table
- Fund managers wishing to expand their fixed income product range
- Risk managers that need to expand their understanding and
Summary of course content
- Historical and current developments - what makes RMB bonds unique?
- Supply and demand drivers behind the growth in issuances
- Past and current regulation and policies
- Risk management, pricing and hedging methodology
- Future market outlook
- Comparison with onshore CNY debt
- Benchmarking and MTM practices
Methodology
A practical and interactive approach is adopted throughout. This programme uses case studies and practical exercises and Q&A are encouraged throughout the course. The course features case studies that explore the unique characteristics of this market and offer real-life solutions to real-life scenarios to ensure that you leave the course ready to apply your new knowledge.
Who should attend this training course
Buy side
- Asset/investment managers
- Pension funds
- Insurance companies
- Private equity
- Central Banks
- Sovereign wealth funds
- Wealth managers
- Mutual funds, unit trusts
- Hedge funds
- Proprietary trading desks
- Risk managers
- Policy makers
Sell side
- Investment bankers arranging bond issuance
- Corporates issuing bonds
- Advisory
- Researchers
Supporting publications:
Definition, overview and current status
- What makes RMB bonds unique?
- Panda vs. dim sum bonds
- Types of CNY/CNH bonds
- How do you best take advantage of this market?
Supply and demand drivers behind the growth of CNH bond market
- Types of issuers
- Who are the issuers?
- Who can issue?
- Type of buyers
- Who are the main buyers?
- Who can buy?
- What is the attraction and key supply/ demand drivers
- Type of dim sum bond offering structures
Case study: RMB bond pricing
Regulation - what regulation is there and how much assurance can be given from following it?
- Recent regulatory developments (e.g. FDI Schemes)
Example discussion: People’s Bank of China issued “Measures for the Administration of RMB Settlement Matters Relating to Foreign Direct Investment”, Ministry of Commerce of the People’s Republic of China issued “Circular on Issues Relevant to Cross-border Direct Investment in RMB”, and State dministration of Foreign Exchange will also release two regulations on crossborder RMB direct investment matters in the near future. The release of these policies regulates more specifically on relevant businesses of RMB direct investments, for example, how to deal with foreign direct investments settled in RMB.
- How regulation has evolved over time
- Regulatory impact on yields
- Treatment of bond proceeds
- Repatriation channels
- Repatriating funds to China
- Repatriating fund to everywhere else in the world
- Policy rates, FX, options
- Macro policies
- Interest rate policy
- FX policy
Guest speaker
Augusto King: Latest case studies on issuing of CNH bonds and the applicability of regulatory
regime on those transactions.
Risk management, pricing and hedging - how we can hedge credit and interest risk
- Credit
- Liquidity
- FX
- Interest rate
- Future products
- Risk for global investors
- Cross currency swap markets and the developments in it. What needs to bedone for the cost to be reduced? Right now it is very expensive
- How to price?
- Matrix affecting pricing
- Primary and secondary pricing
Case study: RMB bond risk management
Market outlook and future developments
- Identifying value in the current market
- Which position to take and how to maintain that position
- Is there a perfect market condition or time to issue/buy DSBs?
- Forecasting
- How big will this market get?
- What will be the state of the market in 5-10 years?
- Investment strategies
Comparison with onshore bonds (CNY)
Benchmarking against your peers (performance)
How to do a MTM (Mark to market: accounting for the value of an asset or liability based on the current market price of the asset or liability) of bonds since price transparency isn’t there
Bilateral repo and collateral management
- Current state of the repo market
- Processes
- Documentation
Course summary and close
Due to the changing nature of this market and its regulations, the course content will be updated between thetime the brochure is published and when the course is run.
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Jeffrey Yap
Jeffrey Yap is a well-known regional financial professional in Asia with over 15 years of experience. Mr. Yap has a deep understanding of multiple asset classes trading and investments. His immense understanding of financial markets in Asia has enables him build and run successful businesses and strategies.
He was voted by his regional peers in The Asset Magazine as one of the top five most astute G3 Asian bond investors in Hong Kong. He holds a MBA from Charles Sturt University and is a Full Member of Hong Kong’s Management Association.
The early part of his career was spent in Malaysia in the equity and fixed-income space before moving to Hong Kong in 2003 to promote global credit trading for Nomura. In 2006, he was appointed Head of Debt Derivatives in Asia for abobank to manage the bank’s proprietary trading business covering Asia Pacific including Japan and the Middle East region. He later joined JL Capital a global macro hedge fund in 2007 as senior portfolio manager to establish and run the firm’s global credit trading strategy. In 2009, he joined the senior management team of CAI Business Indepth as Executive Director, Research and Content Management. He is currently Managing Director and heads up Fixed Income Trading for Mizuho Securities in Asia and has been instrumental in making Mizuho Securities a key player in the offshore RMB fixed income market.
He is a frequent speaker at financial conferences across Asia Pacific and has travelled all over Asia promoting and educating many market participants with regards to offshore RMB fixed income market.
Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.
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