China's central bank, the People's Bank of China, recently announced that it has given permission to the China Construction Bank to start offering mortgage-backed securities. The move caused a flurry of publicity in international newspapers and capital markets publications, with the Financial Times quoting Li Zibin, the mayor of Shenzhen, one of the two cities chosen to pilot the securities, saying that a deal would be launched "very soon or, at the latest, by the end of the year."

The deal in question is linked to a project between CCB and Macquarie Bank, an Australian mortgage bank with significant securitization expertise, which has seen Macquarie advising CCB on originating mortgages with a view to securitization some time in the future. The project has been running for the best part of two years.

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