In november, the arrival of a large pool of amortized cost-based french debt for a centralized “window period” became a major variable in the debt market。
Looking back at 2019-2020, there was a wave of intensive formations of cost-sharing-based products in the context of the regulatory requirements of the new regulations on product pricing. A new wave of “opening” consisting of a statutory debt base of amortized costs has come to an end with the advent of an intensive product opening period in the fourth quarter of this year。
As of 14 november, the total amount of the amortized debt was 190, according to the state of thailand's haitong report, with a total of 1-3 years and 3-5 years in 2019, 3-5 years and 5-8 years in 2020, and a total of 3-5 and 5-8 years in 2020. The amortized cost-based french debt was distributed centrally in 2019 and 2020, and, based on the closed period, the amortized debt base is currently at its peak。
On a scale, the team shaung-woo for macro-analysis of national securities noted that the november 2025 to the first quarter of 2026 was an absolute peak. Over 80 amortized debt bases will enter open windows during this period, with cumulatively over $400 billion。
As a result, the immediate impact of this type of product on the market has received renewed attention — whether the trade of institutional “players” alternated, or the new configuration of the product after its expiry, is at the centre of the market。
According to an economic report of the twenty-first century, the head of investment of the capital market, a shareholding firm, stated that “the debt-sharing base was hot at the beginning of the year, especially in february-march, and has recently risen again”. In his view, such assets “provided them with an ideal mitigation tool”。
The investment manager of a city's comptoir solidified investment manager disclosed to journalists that the amount of the amortized cost method product was scarce after its expiry and that the funds were therefore being “queued”. In his view, the adjusted proceeds of such assets would remain open and the “proceeds” would be leveraged. With the restructuring of the rbi valuations, insufficient supply of low-wave robust assets and low returns on deposits, bank management “should be more urgent” in the choice of amortization。
In response to which types of credit debt are preferred, the aforementioned management manager of the city's business firm stated that the agency's acquisition of the well-meaning varieties resulting from the amortized debt base remained “predominantly based on five-year credit bonds”. This category of assets is more of a product “basket” and subsequent actual contribution depends on the level of institutional availability and other asset allocation。
What is amortized cost-based debt? Such products are known to be characterized by operating models that combine closed operations with regular open-ended operations, and mainly by investment strategies that “buy and hold to maturity” in order to secure a stable interest rate gain. During closed operations, investors were unable to undertake requisitions and foreclosures and the size of the fund remained relatively constant。
This mechanism ensures that fund managers are able to successfully match the long-term period of warehoused bonds with the fund's closure period, thereby securing the holding of assets to maturity, while regular opening settings provide a liquidity window to adjust the allocation of institutional funds。
Why, then, do these products appear to be “specially fragrances” in the eyes of institutional actors
Its core advantage is that products use the “amortized cost approach” to account for the net value of the fund. The valuation method has allowed net values to rise significantly from short-term fluctuations in bond market prices, and has tended to show a smooth upward growth pattern as “up the stairs”, providing investors with an extremely smooth holding experience。
In addition, following the fall of the “debt bull” at the end of last year, the bond market continued this year in a low-interest-rate environment, with significant increases in day-to-day volatility and increasing investment difficulties. By being able to provide stable and predictable returns, such products have been effective in alleviating the fear of large amounts of money for post-market risks and have received institutional “preference”。
In terms of timing, its expiry over the past few years has not been “new”. The team noted that, since its inception in 2019, the statutory debt base for amortized costs has gone through multiple rounds of open-door periods and will enter another round of centralized openings by the fourth quarter of this year and the first half of next year。
In may 2019, a statutory debt base for amortized costs began to be issued and two waves peaked in the fourth quarter of 2019 and the third quarter of 2020. In recent years, products have been phased out, while products have entered their life cycle, and two successive rounds of re-opening have peaked, with 2025 q4-2026 q2 expected to peak in the third round。
It is a matter of concern that the market's exploitation of this category of products is increasingly affecting its bottom assets. When the amortized cost-based debt enters an intensive open period, the market performance is often better in the case of silo varieties that match the product's closing period。
Journalists note that the relatively “lower” performance of interest-rate debt in recent markets is linked to a wave of “hidden” structural performance of the corresponding maturities。
According to the washington macro recovering team, since late october, the fund's net buy-in of three-to-five-year credit bonds has increased significantly, with a net buy-in of three-to-five-year loans of more than $11 billion for two weeks in a row. Amortized debt stock has led to a significant increase in the buy-in of the corresponding term credit debt, thus contributing to lower yields and narrow spreads. On 5 november, the median aaa 5y rate of return was significantly lower than on 21 october by 19bp and the credit spread was narrow by 18bp and the 5y-1y term spread by 17bp。
In addition to the bottom investment, the type of institution that buys amortized debt-based products during this period is also “turning”. Who's leaving? Who's trying to buy it
According to the information received, prior participants had found that the amortized cost-based legal debt was dominated by the maturities of holding, and that net values were less volatile and had been favoured by banks for self-employment. In recent years, however, interest rates have fallen, the return-rate ratio of the bank's own investment debt has declined, the investment restrictions on bank spv have been imposed by superimposed regulation, and bank involvement has declined. For this type of product, the chinese securities collector team indicated that its initial clients were predominantly bank-owned, with closed periods of up to three and five years, and holding up to three and five years of old-age debt。
So, who buys such products after the bank's own “off-site” funds? It is widely accepted by industry that finance is becoming the backbone of the statutory liability base for the residual costs of this round。
With new regulations on management, property management, after a wave of multiple foreclosures, the interest of bank managers in net value stability has increased significantly; at the same time, the downside of interest rates has also prompted finance to seek more profitable assets. Against this background, the relatively stable net-value amortized debt base with greater certainty of return becomes the preferred option, as it does not require the use of venture capital, and the higher interest rate on credit debts, which more reasonably smooths the performance and stabilizes the inherent demand of the net value. Changes in the structure of the debtor-end investor have continued to drive the integrity of the bank's assets to increase the availability of amortized cost-based products in recent years。
According to the macro group of national securities, the source of funding for this type of product has been “replaced”: bank finance has replaced bank self-employment as a core increase, which results from the rectification of private pool products and the new regulations prohibiting embedding, the public pool debt base being the preferred asset for low-fiscal fluctuations, and 84 per cent of the funds raised have been invested in closed-term products for a period of three years。
It is a matter of concern that, at the same time, the bottom of the pool of debt has been replaced by more interest-rate debt, as the main institutional fund has been “connected”. According to the evidence-based collection study, at the end of last year, the banks had set aside a debt base of approximately 13. 8 billion yuan, but by the third quarter of 2025 it had reached 59. 4 billion yuan, which has also contributed to the exchange of debt from government debt to credit in the main debt-bearing vouchers that opened this year。
However, according to interviews with journalists, it may be difficult to “immediately impact” the benefits of such configurations on the returns on property。
The head of investment in the capital market department of one of the aforementioned shareholders pointed out to journalists that, although the current size of the allocation is “very low” and therefore has “low impact on product yields”, in the context of lower interest rate expectations and narrow capital gains, the allocation of the residual debt base, while “severe gains”, was considered to be relatively limited in its potential for gain, largely due to “limited size”。
From the perspective of the bank's own business, the situation is “a few happy families”. Several researchers noted that after deduction of the relevant rates, the interest-rate ratio for this category of products has been reduced, resulting in the current self-financing being “higher”. The head of the centre for the operation of the capital of a comptoir in guangdong also told journalists that it was true that “there are no good alternative products to follow”。
At a time when the focus of current industry attention is on new directions for “reconstruction after opening” varieties, what subdivision of vouchers would be beneficial
An investment manager of the public fund for bond stated to journalists that, in terms of the bottom asset allocation, the three-to-five-year credit and government debt yields were somewhat attractive in low-volume assets, and that the build-up was expected to “slightly raise the portfolio returns” and that “still thinking of increasing the share of the city to invest more” would tap larger gains through a degree of credit sunk. However, with respect to the relatively higher “two-way debt”, i. E., commercial banks' secondary capital debt and sustainable debt, the above-mentioned persons stressed that, while their rates of return were relatively significant, their measurement requirements were not currently within the scope of investment on amortized cost-based debt because they could not be tested through sppi。
Looking ahead, how is the pace and scale of the opening of the affl expected to evolve? From the point of view of time, the successive maturity of the amortized cost-based legal debt over the past few years is no longer “new”。
Moreover, in the current low-debt market environment, the incremental capital generated by it remains high。
The logic of the three-to-five-y credit debt and the benefits to be derived from the type of debt is expected to continue, according to the team that conducted the windfall bond consolidation study. From the perspective of the projected opening-time distribution, it is expected that in november-december 2000+billion yuan of amortized debt will enter the open-door period and that, taking into account the change in the position of the fully financed debt stock in the third quarter of 2025, the additional 5 per cent, 10 per cent and 15 per cent, respectively, are expected to result in an incremental allocation of about $10-30 billion to the bond. In the first quarter of next year, an amortized debt base of 300 billion yuan is expected to enter the open period, with an estimated incremental allocation of about 150 to 50 billion yuan to the general trust debt at the same ratio。
The financial and securities institute's fixed-income analyst wang zhang told journalists that the recent three-to-five-year credit stance had been relatively favourable, and that the market was concerned about the fact that the long-term amortized cost base had entered the reopening period。
“however, in practice, in terms of the buyout structure, variety characteristics and duration of the purchase, it is more likely that the current round will be the spread compression associated with the increase in financial indebtedness.” she further analysed the three-to-five-year credit run-down buyout core, with relatively high external ratings and a relatively weak internal rating, lasting only about two weeks, with overall characteristics comparable to the april 2024 manual catch-up. The recent increase in financial liabilities is likely to come more from the expiry of high-interest term deposits in november 2022, which is the main reason why the liquidity volatility in november was greater than in the preceding period。
Combining the above-mentioned logic, wang dream expected that in december there would continue to be an amortized debt base and high interest-rate term deposits would continue to mature, at which point the market would still be in a downward trend of three to five years, but, given that the current credit margin was already at a relatively low level, it might be below that point。
