NDB successfully issues CNY 3 bln RMB bond in China Interbank Bond Market
On January 27, 2022, the New Development Bank (NDB) successfully issued CNY 3 billion RMB-denominated Bond in the China Interbank Bond Market. With this issuance under the Bank’s second RMB 20 billion Bond Programme in China, the total outstanding amount of RMB bonds issued by the NDB has reached CNY 20 billion, making the Bank one of the largest panda bond issuers in the RMB market.
The net proceeds from the sale of the Bond will be used onshore as general corporate resources of the NDB and to finance infrastructure and sustainable development activities in the Bank’s member states. Pending their use, the net proceeds from the sale of the Bonds will be invested as part of the NDB’s liquid assets.
The transaction saw strong interest from both onshore and offshore RMB investors and the issue was subscribed 1.5 times. The geographical distribution of investors was as follows: Mainland China – 84%, HK SAR and Macau SAR – 8%, Asia excluding greater China– 8%. Investor distribution by type: Bank treasury – 75%, Security – 18%, Central bank and official institution – 7%.
“We are delighted by the strong support seen on our first Renminbi bond in 2022. It is a clear demonstration of investors’ confidence in the New Development Bank and its strong commitment to raising funding in the local currency of our member countries. The NDB is a regular issuer in the China Interbank Bond Market and the Bank will continue to build its RMB bond curve,” said Mr. Leslie Maasdorp, NDB Vice President and Chief Financial Officer. “China’s bond market is expanding rapidly. As a multilateral bank aiming to become a premier development bank for emerging economies and developing countries, NDB has noticed great opportunities brought by China’s commitment to open up its capital markets. The NDB will continue to explore further local currency bond issuances in China as well as other member countries.”
Bank of China (BOC) acted as the lead underwriter of the Bond. Industrial and Commercial Bank of China Limited, Agriculture Bank of China, Deutsche Bank, DBS Bank (China) Limited, China International Capital Corporation Ltd. (CICC), CITIC Securities acted as joint-lead underwriters.
Bond Summary Terms
|Issuer||New Development Bank (NDB)|
|Issuer rating||AA+ (S&P) / AA+ (Fitch) / AAA (JCR) / AAA (ACRA)|
|Book building date||January 26, 2022|
|Settlement date||January 27, 2022|
|Maturity date||January 27, 2025|
|Listing||China Interbank Bond Market|
|Lead Underwriter||Bank of China|
|Joint-lead underwriters||Industrial and Commercial Bank of China Limited, Agriculture Bank of China, Deutsche Bank, DBS Bank (China) Limited, China International Capital Corporation Ltd. (CICC), CITIC Securities|
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.