China will further improve policy arrangements for panda bonds to facilitate more issuance and trading by overseas institutions, including sovereign states, according to the People's Bank of China, the country's central bank.

Analysts say removing some expenses for foreign borrowers will help funnel more yuan overseas and create a large offshore liquidity pool of China’s currency.

China will further improve policy arrangements for panda bonds to facilitate more issuance and trading by overseas institutions, including sovereign states, according to the…