Tier-2 perpetual bond issuance by Chinese commercial banks accelerated into
June. As of June 3, banks issued 22 Tier-2 perpetual bonds year-to-date totaling
646 bln yuan; April issuance alone was 315 bln yuan, a multi-year high for the
month. Market participants attribute the pickup to faster regulatory approvals,
a low-rate window that lowers funding costs, and special government bond
injections supporting bank capital. YTD issuance yields have declined sharply
versus the same period in 2025, with a minimum of 1.9% and an average of 2.03%
through June 3. Tianfeng Securities’ fixed-income chief analyst Tan Yiming said
funds were the main buyers in May, drawn by relatively wider credit and product
spreads.
