The Bank of China Singapore branch has successfully issued a Singapore dollar (SGD) 500 million senior unsecured bond – part of Bank of China’s multi-tranche, multi-currency bond offering to support China’s “One Belt One Road” initiative.
This is the largest-ever Singapore dollar senior unsecured bond issued by a commercial bank in Singapore and it also makes the Bank of China Singapore branch the only Chinese bank to launch a benchmark-sized Singapore dollar bond locally in recent years.
In addition to the Singapore dollar issuance, Bank of China also launched a renminbi (RMB) 5 billion bond on the same day. Bank of China will list both bonds on the Singapore Exchange to commemorate Singapore’s 50 years of independence.
The Bank of China “One Belt One Road” notes were issued in euros, dollars, Singapore dollars and renminbi – with pricing for all currencies completed in the same day. The aggregate total of USD 4 billion raised will be used to support “Belt” and “Road” related projects.
Rated A1 by Moody’s Investors Services and A by Fitch Ratings, the four-year SGD 500 million bond saw strong investor interest, with the issuance drawing close to 100 investors and being three times oversubscribed. The bond is priced at 2.75 per cent – far below the initial price guidance, reflecting investors’ confidence in the Bank of China Singapore branch.
The bond issuance follows the Bank of China Singapore branch’s launch of the “Lion City” bond last year – the largest Chinese renminbi bond issuance in Singapore at that time. With this issuance, the Bank of China Singapore branch sets a new benchmark for Chinese banks offering Singapore dollar bonds – paving the way for increased vitality in this market.
Established in 1936, the Bank of China Singapore branch is one of the longest-operating banks in Singapore. The bank holds a Qualifying Full Bank License (QFB) and is the largest Chinese bank in Singapore in terms of business scale.
General Manager of Bank of China Singapore Branch and Country Head, Ms. Guo Ning Ning, said the branch’s long history of continued success in the market is not possible without the trust and support of the Singapore Government, regulators and customers.
“With its strategic location and established reputation as a global financial hub, Singapore is an important centrepiece to the ‘21st Century Maritime Silk Road’ strategy. The successful issuance of the SGD 500 million bond and listing of the RMB 5 billion bond on the Singapore Exchange demonstrates Bank of China’s utmost commitment to supporting the development of Singapore as a leading offshore renminbi centre. It further reflects Bank of China’s strong confidence in Singapore’s economic development.
“The Bank of China Singapore branch is focused on achieving its mandate of ‘fulfilling social responsibility’ and being the ‘best bank’ so that it can continue to contribute meaningfully to the economic development of both Singapore and China,” Ms. Guo said.
