China allowed more international investors to buy bonds on the nation's largest debt market and purchase higher-yielding notes for the first time, as the world's second-biggest economy continues to develop its capital markets.

Participants in the Qualified Foreign Institutional Investor program now may buy bonds on the interbank market, the China Securities Regulatory Commission said in a Friday statement on its website. Previously, participants were restricted to exchange-listed debt, which is less than 2 percent of the interbank equivalent.

International investors will also now be permitted to buy bonds of small and medium-sized companies through private placements, the regulator said. Such securities typically yield more than their counterparts listed on China's stock exchanges.

Agencies - China Daily