Railway Yield Gap at Six-Month High as Debt Mounts: China Credit

China’s state-owned railroad is increasing debt sales by 50 percent, driving yield premiums on its bonds to the highest levels in more than six months, as the world’s biggest high-speed network is rolled out.

The yield on the railway ministry’s 3.88 percent September 2020 bonds exceeded the rate for similar-maturity government notes by 115 basis points yesterday, almost double the 59-point gap when the security began trading in September, according to Chinabond prices. China’s No. 1 corporate debt issuer sold 30 billion yuan ($4.6 billion) of notes in the past two months, more than the combined sales of its counterparts in India and Russia for the whole of 2010, according to data compiled by Bloomberg.