Chinese companies tap 'virus bonds' to raise billions quickly

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The virus bonds go through a faster approval process that takes just days, rather than weeks for other types of bonds. YahooFinance

SHANGHAI/HONG KONG - Chinese companies are using cheap funds raised via"virus bonds" in part to bolster their balance sheets as they capitalise on Beijing's efforts to channel money into virus-hit areas of the economy.

These virus bonds go through a faster approval process that takes just days, rather than weeks for other types of bonds. They also carry yields much lower than on other debt as state-controlled banks are encouraged to buy such instruments. The virus epidemic has killed more than 1,350 people and sickened 60,000 in China, stretching the country's resources at a time when the economy is already slowing down..

The company said that 60 million yuan, or one-tenth of the proceeds, will be used to produce glass for ambulances, which are"indispensable resources" in virus-hit zones.

 

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