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CCDC Supports Foreign Institutions’ Participation in China Local Government Bonds Issuance

On July 19, with the support of CCDC Shanghai Headquarters, Shanghai Municipal Government successfully issued in China inter-bank market the local government bonds of 34.33 billion yuan on the MOF Local Government Bond Issuance System.

In response to the requirements of deepening financial reform and opening up, and in order to implement policies to lift restrictions on foreign banks’ participation in local government bond underwriting business, further leverage the advantages of foreign financial institutions, promote the diversification of local government bond investment base, and better utilize various types of capital to support regional economies, the underwriting group of this issuance included two foreign banks, Standard Chartered Bank (China) Co., Ltd. and DBS Bank (China) Co., Ltd., the first foreign-funded financial institutions participating in the issuance of domestic local government bonds.

The tender result suggests an oversubscription by all investors. The bidding multiples of various terms ranged from 2.56 to 3.43 times, and the total amount of foreign bank bids reached 330 million yuan. Specifically, the total amounts of issuance of Shanghai Municipal Government general bonds reached 30.28 billion yuan, including three-year, five-year, seven-year, and ten-year varieties, and the winning bid rates are 3.24%, 3.32%, 3.55%, and 3.57%, respectively; the total amounts of issuance of special bonds reached 4.05 billion yuan, including two maturities of five years and seven years, and the winning bid rates are 3.30% and 3.48% respectively.

As the national core financial infrastructure, CCDC provides technology support and integrated lifecycle services, including information disclosure, registration and depository, transaction settlement, interest payment, collateral management and bond valuation, for the issuance the local government bonds, which are highly recognized by all parties involved.

 

CCDC Shanghai Headquarters

July 19, 2018

    Publish on :07/23/2018 08:52
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