UPS turns to offshore renminbi for commercial paper funding

Atlanta-headquartered package delivery company UPS closed a Rmb630 million $99 million offshore renminbi-denominated commercial paper CP transaction on Friday making it the first foreign non-financial company to do so. Given the small issue size, UPS’s move to tap the CP market was probably more symbolic than anything else, though it is expected to continue issuing in the market.

However, as more borrowers are pushing tenors in the dim sum market, the UPS deal does reflect that a number are also keen to issue short-dated paper, and there is demand for it. Indeed, banks have been issuing short-dated certificates of deposit for some time.

“The offshore deliverable...