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China Agricultural Bank sells US$1b debut "green bond" in London
[HONG KONG] Agricultural Bank of China , the country's third-largest listed lender, completed its debut sale of US$1 billion dual currency bonds late on Tuesday in London - the first "green bond" from a Chinese bank.
Green bonds are issued to fund environment-friendly projects. This category of fixed-income instrument is growing fast as countries tackle climate change and pollution, a pressing issue in China.
The 600 million yuan (US$94.53 million) two-year yuan-denominated tranch of the bond was priced at 4.15 per cent.
The order book reached about 4.9 billion yuan from 71 accounts. Asian investors accounted for 94 per cent of demand while the rest went to European investors.
Banks took an 82 per cent share, followed by funds at 12 per cent and private banks at 6 per cent.
The dollar segments were a US$400 million three-year tranche priced at 2.125 per cent and a US$500 million five-year tranche at 2.75 per cent.
The bond will be listed on the London Stock Exchange, with the proceeds to fund eligible green projects, the term sheet showed.
Agricultural Bank of China International, Barclays, HSBC and JP Morgan are joint global coordinators of the issue.
China Construction Bank sold 1 billion yuan of offshore yuan bonds in London earlier this week, and the People's Bank of China (PBOC) is expected to issue up to 5 billion yuan of one-year bills in London soon.
Britain and China agreed to a series of initiatives in September ranging from an expanded currency swap agreement to a feasibility study for a scheme to connect the London and Shanghai stock markets.