Malaysian tigers chase S'pore lions in yuan race

[SINGAPORE] The Malaysian and Singapore governments, competing for a share of bond issuance in a globalising Chinese yuan, are finding big-cat branding alone isn't enough to challenge the dominance of Hong Kong.

Cagamas Bhd raised 1.5 billion yuan (S$309 million) earlier this month in Malaysia's inaugural offer of Tiger Emas bonds, the first issue in the Chinese currency to be cleared locally. The new securities join Lion City debentures in Singapore and Formosa bonds in Taiwan, which started last year and together comprise about 5 per cent of a market that's dominated by Hong Kong's Dim Sum notes, Bloomberg data shows.

Singapore's position as a regional private banking hub, and Malaysia's stronghold as an Islamic finance centre will bring new investors into the offshore yuan bond market. Hong Kong's advantage lies in its head start in opening up trade and investment in the currency. Yuan deposits in the city are approaching the …