Offshore borrowing in China's currency reached a record Rmb1tn ($149bn) this year, driven by international corporations and foreign governments exploiting record-low Chinese interest rates. The dim sum bond market (offshore) issued Rmb786.3bn, surpassing last year's total, while the panda bond market (onshore) hit Rmb231.6bn, a new annual record. The 10-year Chinese government bond yields 1.68% versus 4.78% for U.S. Treasuries, near the widest spread ever.

Chinese entities account for nearly two-thirds of dim sum issuance, using proceeds for overseas operations. Authorities expanded the Bond Connect quota over summer, enabling mainland insurers to invest southbound, boosting long-dated issuance. Tencent issued 10- and 30-year dim sum bonds.

UBS debuted with Rmb2bn five-year panda bonds at 1.78% coupon; Goldman Sachs issued Rmb61.5bn dim sum bonds. Kazakhstan's Kaz Munay Gas sold Rmb3.5bn dim sum bonds via Citi. Panda bonds yield 1.85% weighted average (3.17-year duration) versus 1.7% for 10-year Chinese sovereigns, but remain just 0.25% of China's bond market.

Growth is primarily bank-driven, per Deutsche Bank's Samuel Fischer.