ADB’s latest quarterly Asia Bond Monitor shows that as of the end of June, there were $7.9 trillion in outstanding bondsing emerging East Asia, 2.5% more than at the end of March and 9.3% more than at the end of June 2013.Local currency bond issuance totaled $1.1 trillion in the second quarter, up from $852 billion in the first quarter. Meanwhile, sales of bonds denominated in US dollars, euros, or yen in January through July was $121.4 billion, suggesting the region will set another record for annual issuance.Emerging East Asia comprises the PRC; Hong Kong, China; Indonesia; the Republic of Korea; Malaysia; Philippines; Singapore; Thailand; and Viet Nam.Viet Nam was the fastest growing local currency bond market, both on a quarterly and an annual basis. However, the PRC remains the largest market in Asia after Japan, with $4.9 trillion in outstanding bonds. That marked a 3.4% on-quarter rise and a 10.8% annual rise, largely due to the increase in outstanding policy bank bonds and local corporate bonds.In the PRC, a slowing of the property market is a concern because most collateralized borrowing is secured against property. A drop in property-related revenue could make it more difficult for local government to service their bonds. Property companies have also become increasingly prevalent bond issuers themselves.
