Why Chinese banks are bolstering their capital ratios

The restructuring of the shadow banking sector and a looming Basel III deadline is prompting Chinese banks to increase their capital raising efforts, with a wave of transactions expected to hit the capital markets subject to regulatory sign off. 

First off has been Bank of China Hong Kong, which raised $3 billion from a perpetual non-call five Additional Tier 1 AT1 deal on Tuesday.

Investment bankers working in Asia’s financial institutions FIG sector say it is notable that the year's first Chinese dollar-denominated AT1 deal has come from a bank's overseas subsidiary. 

Bank of China HK had far more...