On October 25, 2022, the New Development Bank (NDB) successfully priced a 3-year CNY 3 billion bond in the China Interbank Bond Market, completing the NDB’s second RMB 20 billion bond programme. The bond was priced at the tighter end of its price guidance at a yield of 2.53%.
The net proceeds from the sale of the bond will be used onshore as general corporate resources of the Bank for financing infrastructure and sustainable development projects. Pending their use, the net proceeds from the sale of the bond will be invested as part of the Bank’s liquid assets.
“We are very pleased with the successful execution of the RMB 3 bln bond issuance. With this issuance, NDB has now raised the full RMB 20 bln under its existing program. We remain strongly committed to support China’s efforts to strengthen its domestic capital markets,” said Mr. Leslie Maasdorp, NDB VP & CFO.
“As the NDB continues to expand its operations, the Bank is actively accessing the China Interbank Bond Market, ensuring that sufficient resources are available to meet the NDB’s loan requirements in local currency. NDB is planning to register its third RMB bond programme with NAFMII before the end of 2022 deepening its role as a leading issuer of Panda Bonds,” added Mr. Leslie Maasdorp.
The Bank of China Ltd. acted as the lead underwriter and the bookrunner of the issuance. Industrial and Commercial Bank of China Ltd., Agricultural Bank of China Ltd., the Export-Import Bank of China and China Construction Bank acted as joint-lead underwriters of the issuance.
Bond Summary Terms
| Issuer | New Development Bank (NDB) |
| Issuer rating | AA+ (S&P) / AA (Fitch) / AAA (JCR) / AAA (ACRA) |
| Amount | RMB 3,000,000,000 |
| Book building | October 25, 2022 |
| Settlement | October 26, 2022 |
| Maturity | October 26,2025 |
| Tenor | 3 years |
| Currency | RMB |
| Listing | China Interbank Bond Market |
| Lead Underwriter | Bank of China Ltd. |
| Joint-lead underwriters | Industrial and Commercial Bank of China Ltd., Agricultural Bank of China Ltd., the Export-Import Bank of China and China Construction Bank |
Background information
NDB was established by Brazil, Russia, India, China and South Africa to mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging market economies and developing countries, complementing the existing efforts of multilateral and regional financial institutions for global growth and development. In 2021, NDB initiated membership expansion and admitted the United Arab Emirates, Uruguay, Bangladesh and Egypt as its new member countries.
In October 2020, the NDB has successfully registered its second RMB Bond Programme in the China Interbank Bond Market. The NDB was granted approval to raise up to RMB 20 billion in the China Interbank Bond Market within 2 years of the Programme registration date. The proceeds of the Programme will be used to finance infrastructure and sustainable development projects in the Bank’s member countries.