Yankee bonds by Reliance Industries, Power Finance Corporation (PFC) and ICICI Ltd have seen depreciation in values over the last two weeks, almost wiping off the gains they made in the previous two months, bankers said.

Bankers, however, ruled out any panic sale in the bonds after the "war-like situation" with Pakistan in the Kashmir border and pointed out that a depreciation was seen in bonds of most of the Asian countries.

ICICI's 7.55 per cent bonds maturing 2007 depreciated by 40 basis points to trade at 400 basis points over the value of the US Treasury as compared to 360 basis points on May 15.

Similarly, PFC's 7.5 per cent bonds maturing July 2009 depreciated by about 75 basis points to 500 basis points over US Treasury on May 31 as compared to 425 basispoints on May 15.

PFC's paper was trading at 525 basis points on April 26.

Reliance's 8.15 per cent bonds maturing September 2005 fell by 75 basis points to 475 basis points over US 10-year treasury in the same period, wiping off the entire gains the bonds made in the last two months.

Bankers said China's 7.30 per cent sovereign bonds maturing 2008 fell by 20 points to 215 basis points on May 31 as compared to 195 basis points on May 15.

An analyst with ICICI Securities said the depreciation in values of Asian bonds could be consiered a correction, which was "long-overdue."

He said Asian Yankee bond markets seemed to have factored in the possibility of US interest rate hike, and the bonds are expected to remain stable at current levels.

Yankee bond 7.125 per cent maturing in 2006 by Malaysia's Petronas depreciated by about 55 basis points over the US Treasury on May 31 as compared to 265 basis points it traded on May 15.

Sovereign paper by Thailand maturing in 2007 and having a coupon rate of7.75 per cent also declined by 50 basis points in the last fortnight, bankers said.

They said Korea's 8.875 per cent 2008 paper fell by a marginal 25 basis points in the last fortnight.

Some other Asian Yankee bonds which have declined in values over the last fortnight were Indonesia's 7.75 per cent sovereign maturing 2006 and Philippines' 8.875 per cent sovereign bonds maturing 2008, bankers added.