Dim Sum bonds gaining popularity in Australia

More Australian corporate borrowers are expected to issue Dim Sum bonds by the middle of next year, Bank of China Ltd said, after the first such offering was made by an Australian state government last week.

The sale by New South Wales, the country's biggest regional economy, of 1 billion yuan ($163 million) of securities opens the door for non-financial companies that do business with China, said Shanjun Hu, Australia country head for Bank of China, which managed the transaction with Australia & New Zealand Banking Group Ltd.

"I can imagine in the coming years more and more Australian companies will participate," Hu said in a Nov 20 interview in Sydney. BOC has spoken to potential issuers and the market may develop "very quickly," possibly reaching "hundreds of billions" of yuan over the next few years, he said.