China PBoC Buys E1 Billion In Spanish Sovereign Debt: Paper

FRANKFURT (MNI) – The People’s Bank of China bought a billion euros
in Spanish government debt, according to Spanish daily Expansion on
Friday.

The newspaper reported that the State Administration of Foreign
Exchange (SAFE), the administrative agency that manages state foreign
exchange reserves, made the purchase and the major buyer of 10-year
bonds issued by the Spanish Treasury last week, taking up 25% of the
total at an interest rate of 5.4%.

The paper noted the contrast between this purchase and the Chinese
sovereign wealth fund China Investment Corp, whose president recently
said that Eurozone debt and in particular Spanish and Italian debt “were
not an ideal investment.”

China has also been investing in recent weeks in covered bonds of
Spanish banks, according to Expansion, including 8% of an emission by
Sabadell on February 6 (for a total of 100 million euros) and part of an
emission by CaixaBank.

–Frankfurt bureau tel.: +49-69-720142. Email: dbarwick@marketnews.com

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