Exclusive-China tells LGFVs to stop issuing offshore 364-day bonds -sources

Chinese regulators have told heavily indebted local government financing vehicles (LGFVs) to stop issuing offshore bonds with a 364-day duration, closing a regulatory loophole that had allowed them to increase borrowing further last year, four sources familiar with the matter told Reuters. LGFVs were set up by Chinese local governments to fund infrastructure investment, and their combined debt has ballooned to roughly $9 trillion, posing a major risk to a slowing economy. China has rolled out several measures to resolve local government debt risks, and new issuance of LGFV debt is tightly regulated.