On May 23, with Bank of China International (BOC International) as the lead co-underwriter and bookkeeper, the Baden-Wuertternberg development agency of Germany successfully issued an RMB 150 million 5-year bond in Hong Kong, the first time in history for a European government agency to raise funds in an RMB offshore bond market.
With a credit rating of AAA (Moody's)/AA+(Standard & Poor's), the Baden-Wuertternberg development agency is known as one of the highest rated European bond issuing institutions. The issuance received overwhelming market response with the subscription of over four times the issuing amount, ending successfully with the lowest point in the range of the interest of the bond.
According to Bian Fang, sales manager of financial products in charge of bond issuance business in BOC International, compared with the RMB 450 billion of total deposits in Hong Kong, the RMB 84 billion bonds currently issued in Hong Kong shows huge market potential. Meanwhile, the relatively low bond interest rates in Hong Kong and the policy support by the Hong Kong SAR Government encourage more European and American companies and institutions to select RMB-denominated financial products as a new channel of financing in the Asian market.
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