- China’s interbank market debt issuance reached ¥10.1 trillion in 2025, with net financing of ¥1.7 trillion supporting the real economy.
- Outstanding interbank debt instruments exceeded ¥18 trillion by end-2025, up about 10% year over year.
- Average issuance rates fell to roughly 2.05%, 38 basis points lower than 2024.
- Issuance broadened to new and private firms, with 230 first-time issuers raising ¥123.9 billion and 135 private firms issuing ¥578.2 billion.
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Chinese enterprises raised ¥10.1 trillion in interbank debt financing in 2025 through instruments on the interbank market, indicating a robust supply of financing via non-exchange channels. This volume staying above ¥10 trillion for the second consecutive year suggests both continuity in demand for corporate debt and confidence in issuance even in a slowing global environment.
The net financing—meaning new issuance minus redemptions—was ¥1.7 trillion, implying a large portion of the total issuance went toward refinancing existing obligations rather than net additions of corporate credit. This places emphasis on rollover risk, especially if external interest rates or credit spreads rise.
The outstanding volume (¥18 trillion) growing ~10% YoY reveals that liabilities in the interbank debt market are expanding steadily. Combined with the drop in average interest rate (to ~2.05%) by 38bps, suggests that market liquidity remains favorable and investor appetite for this debt class remains strong.
First-time issuers (230 entities, ¥123.9 billion issuance) and private enterprises (135 firms, ¥578.2 billion) accounted for notable shares, especially in private corporate credit bonds. Private issuance exceeding 70% of total private corporate credit bonds signals state policy encouragement and financial inclusion efforts are active.
Strategic implications: Internally, China is using its interbank debt market as a lever to channel credit to manufacturing, pharmaceuticals, agriculture, tourism, especially among private firms and new issuers. Externally, low interest rates and rising volumes may attract foreign participation or at least provide comparative funding advantages vis-à-vis international debt. However, rollover risk and credit quality remain key open questions: how many enterprises are marginal or overleveraged, and what is the quality and duration profile of outstanding debt?
Open questions:
- What is the maturity profile of both new issuance and outstanding debt—and how exposed are issuers to rising benchmark rates or credit risk?
- What is the default rate or credit performance in this segment, especially among first-time and private issuers?
- How is this interbank financing interacting with local government financing vehicles (LGFVs), shadow banking, and other off-balance sheet liabilities? Are risks being transferred?
- What policy levers does the Chinese government hold to control overleverage or risk concentrations if defaults increase in private or smaller sectors?
Supporting Notes
- Some 10.1 trillion yuan was raised in 2025 via interbank debt financing by over 2,300 enterprises.
- Net financing—the measure of new debt minus repayments—was 1.7 trillion yuan, supporting real economy operations.
- Outstanding interbank debt instruments surpassed 18 trillion yuan at end-2025, rising ~10% year-over-year.
- Average issuance interest rate dropped to 2.05%, down 38 basis points from 2024.
- 230 first-time issuers raised 123.9 billion yuan across sectors like large-scale manufacturing, pharmaceuticals, agriculture and tourism.
- Private firms issued 578.2 billion yuan; this issuance represented over 70% of private corporate credit bonds in 2025.