CICC Assists AIIB in RMB 3 bn RMB-denominated Panda Bond Issuance

2020-06-11Corporate News

On June 11, 2020, CICC, as Joint Lead Underwriter, successfully assisted the Asian Infrastructure Investment Bank (hereinafter referred to as “AIIB”) to issue RMB 3 billion renminbi-denominated Panda Bond (combatting COVID-19) (hereinafter referred to as “the Bond”) in the China Interbank Bond Market, with a 3-year tenor and the coupon rate of 2.40%. This transaction marks as AIIB’s inaugural Panda bond issuance in the Chinese domestic capital market. The milestone transaction contributes to the internationalization of RMB, the further opening-up of China’s bond market and the sustainable development of Asian infrastructure.

This transaction marks as AIIB’s debut RMB-bond financing. CICC, as the only investment bank among all lead underwriters, has fully demonstrated our capability in dealing with complex market situations and Panda bonds’ underwriting capability despite the volatile macro environment both at home and abroad. Leveraging our excellent sales force in the domestic and overseas market, CICC successfully assisted AIIB in gaining wide recognition from investors and successfully complete the issuance. The Bond represents a milestone transaction in the Asian bond market amid the sharp adjustments in the bond market, and lays a solid foundation for AIIB’s premium image in the global capital market.

The transaction set a market benchmark through pricing the Bond below the China Development Bank Bond secondary market yield that of the same tenor.

During the pre-pricing order inquiry period, CICC fully leveraged the firm’s resources to assist AIIB in conducting extensive marketing efforts and roadshows. CICC introduced high-caliber domestic and overseas investors, adopted innovative Internet tools for in-depth promotion, and arranged meetings with top-notch sovereign-type investors, thus securing effective investor demands for the Bond. On the day of bookbuilding, CICC exclusively contributed high-quality orders. The Bond, under the current ongoing sharp adjustments in the bond market, were still favorably priced below the comparable China Development Bank bond secondary market yield, equivalent to 23bps below CDB 3-year bonds, showcasing milestone significance.

The Bond will help enhance the capital strength of AIIB and support the sustainable development of infrastructures in Asia.

The Panda bond issuance will provide AIIB with tailwinds to realize its mission of fostering sustainable economic development, create wealth and improve infrastructure connectivity in Asia by investing in infrastructure and other productive sectors. The Bonds, as a COVID-19 combatting bonds, approx. RMB2.5 billion of the proceeds will be used as part of AIIB’s COVID-19 Crisis Recovery Facility, giving strong point for AIIB supporting the COVID-19 containment and sustainable development in China and Asia.

AIIB is an intergovernmental non-political multilateral development institution in Asia, and is also the first multilateral financial institution initiated by China globally. At present, AIIB has 102 member countries, including 50 region members and 52 non-region members. The mission of AIIB is to foster sustainable economic development, create wealth and improve infrastructure connectivity in Asia by investing in infrastructure and other productive sectors; and promote regional cooperation and partnership in addressing development challenges by working in close collaboration with other multilateral and bilateral development institutions.