[SHANGHAI] Municipal bond issuance under China's local government debt swap programme touched 2.96 trillion yuan (S$598.41 billion) in the first seven months of the year, official news agency Xinhua reported on Wednesday, quoting China's minister of finance.
That is nearly as large as the total swap volume for 2015, which was 3.2 trillion yuan. The swap programme was initiated by the ministry of finance last year to help local governments refinance high-interest debt through the new municipal bond market.
China will also strengthen risk controls for local government debt, improve the method of calculating such debt, strengthen oversight of issuance and intensify investigations into irregular issuance, the minister said.
Recent unconfirmed local media reports have indicated that regulators may be considering tightening regulations for debt issuance by local government controlled financing and investment platforms on public exchanges, where they constitute a significant proportion of issuance.