Redemption and Capital Needs Drive Surge in Issuance of Banks' Tier-2 Perpetual Bonds in First Three Quarters

In the first three quarters of this year, commercial banks significantly increased issuance of tier-2 capital bonds and perpetual bonds (collectively referred to as 'tier-2 perpetual bonds'), with a combined scale of approximately 1.63 trillion yuan, representing a year-on-year growth of about 30%. The need to refinance existing bond redemptions alongside new capital requirements from credit expansion has driven banks to accelerate raising funds. In terms of funding pathways, large and medium-sized banks have become the primary issuers of tier-2 perpetual bonds, while smaller banks have relied more on capital increases through share issuance.