(Yicai Global) July 3 -- The China Development Bank will issue the first batch of financial bonds under the Chinese interbank bond market's Bond Connect scheme and will collect orders from onshore and offshore investors today in response to the central government's call to support Hong Kong's development and encourage connectivity between the bond markets of mainland China and Hong Kong, Cnstock.com reported yesterday.
The CDB will issue up to USD2.94 billion (CNY20 billion) of one-year, three-year and 10-year fixed-rate bonds for tender via the People's Bank of China's issuance system from July 4 in the largest offering of its kind. Overseas investors meeting the PBOC's requirements will be able to buy bonds directly via the northbound trading mechanism.
One-year bonds will be offered to retail Chinese investors via three banks -- Industrial and Commercial Bank of China Ltd [SHA:601398], Agricultural Bank of China Ltd. [SHA:601288] and Bank of China Ltd. [SHA:601988]. The CDB's latest bond issuance will be the first to cover onshore and offshore markets, institutional and retail investors, and retail and wholesale channels.
The China Development Bank has appointed eight domestic institutions -- Bank of China Ltd. [SHA:601988], CITIC Securities Co. [SHA:600030], Agricultural Bank of China Ltd. [SHA:601288], Orient Securities Co. [SHA:600958], China Construction Bank Corp. [SHA:601939], Industrial and Commercial Bank of China Ltd. [SHA:601398], Bank of Ningbo Co. [SHE:002142] and Bank of Hangzhou Co. [SHA:600926] -- as lead underwriters, with 38 Chinese firms forming an underwriting association.
The CBD has hired 10 institutions -- the Hongkong and Shanghai Banking Corporation Ltd., China Construction Bank (Asia) Corp., Japan-based Bank of Tokyo-Mitsubishi UFJ Ltd.'s Hong Kong branch, DBS Bank, Bank of Communications Ltd.'s [SHA:601328] Hong Kong branch, Agricultural Bank of China's Hong Kong branch, Industrial and Commercial Bank of China (Asia) Ltd., Bank of China (Hong Kong) Ltd., BOC International Holdings Ltd. and Standard Chartered Bank (Hong Kong) Ltd. -- as cross-border coordinators. These domestic and offshore groups will work with CBD to help it complete the issuance.