China Construction Bank issues three ESG-themed bonds; one to list on SGX

CHINA Construction Bank Corporation (CCB) has issued a two billion yuan (S$408.9 million) "Transition Bond" with its Singapore branch as its issuer, that will be listed on both the Singapore Exchange (SGX) and Hong Kong Stock Exchange on April 22, 2021.

This is one of three environmental, social and governance (ESG) themed bonds CCB issued on April 15, 2021, in Singapore, Hong Kong and Luxembourg, said the bank in a statement on Friday. They were worth a total of US$2.4 billion.

The issuance of the Transition Bond marks the first of such a bond CCB has issued through its Singapore branch and which will be mainboard-listed, the bank said. The bond was priced at 2.85 per cent, after achieving a tightening of 30 basis points from the initial price guidance.

Transition bonds support traditional, carbon-intensive industries in their move towards decarbonisation projects.

Funds raised in the Transition Bond issuance would go towards selected projects that span power, gas, steam, manufacturing and steel industries. The bank said this bond provides an additional avenue for investors in Singapore and the region to participate in ESG projects in China.

In December 2020, the Monetary Authority of Singapore granted CCB a qualifying full bank licence under the China-Singapore Free Trade Agreement Upgrade Protocol. It allows investors in Singapore to access the commodity derivatives market in China.