china everbright limited issues panda bonds a boost for rmb’s internationalisation

业务发展 2016/08/16
下载pdf
china everbright limited (“cel”, stock code: 165.hk), having obtained the approval to issue panda bonds with a total face value of not more than 12.8 billion yuan, successfully issued its first tranche of panda bonds worth 4 billion yuan. this represents the third public offering of panda bonds in the stock exchange market, and is to date the largest issue of exchange-traded panda bonds and the largest of any planned offering.
 
against the backdrop of the renminbi’s internationalisation, regulatory authorities in 2016 gradually relaxed policy controls on the issuance of rmb bonds among overseas institutions. in addition, china’s accommodative monetary policy is expected to continue and bond yields have declined across the board, providing a positive environment for cel to issue panda bonds. cel was quick to make and execute policy decisions by taking advantage of these favourable conditions. in less than two months, cel received approval from the china securities regulatory commission on 12 july 2016 to issue corporate bonds with an aggregate principal amount of not more than 12.8 billion yuan. on 25 july 2016, cel completed the issue of the first tranche of corporate bonds with an aggregate principal amount of 4 billion yuan. meanwhile, capitalising on the strong shareholder background of china everbright group, a fully-licensed financial holding company, cel has actively engaged in business collaborations, appointing everbright securities as the lead underwriter and china everbright bank as the custodian bank for the issues of exchange-traded panda bonds.
 
two types of panda bonds were issued in july: 3 2 years and 5 years. the bonds with a 3 2 year maturity were subscribed 4.75x and, after activating the clawback mechanism, the final issue size reached 1 billion yuan with a coupon rate of 2.92%, the lowest interest rate in 2016 for bonds of the same rating (aaa), maturity and size. the 5-year bonds were subscribed 4.25x, with a final issue size of 3 billion yuan and a coupon rate of 3.24%, the lowest interest rate over the last four months for bonds of the same rating (aaa) and maturity.
 
“the latest successful issue of panda bonds represents cel’s debut in the domestic capital market, marking our continued efforts to broaden our financing channels and the achievement of the company’s strategic goal of having both domestic and overseas financing platforms,” said chen shuang, executive director and ceo of cel. “at the same time as it burnishes our international corporate image, the issue also demonstrates cel’s strength and market recognition. it is a positive initiative that contributes to the building of bond issuing capacity and the progress of the renminbi’s internationalisation.”