Bank bonds hit after rate 'shock'

Financial firms bear brunt of move; earnings prospects overshadowed

HONG KONG - Bonds of Chinese financial companies have been hit the hardest in the nation's debt market this month, as a surprise interest-rate increase overshadows brighter earnings prospects.

The securities have lost 1.45 percent, the most since the last series of rate boosts in July 2007, according to Bank of America Merrill Lynch's China Corporate Index. Bonds issued by Agricultural Bank of China Ltd, China Minsheng Banking Corp and China Citic Bank Corp handed investors losses of at least 1.9 percent, the worst performances among the top 50 issuers.