OREANDA-NEWS. January 02, 2014. Agricultural Bank of China Limited (ABC) successfully issued RMB bonds worth RMB1.5 billion in Taiwan. This was the first RMB-denominated Formosa bond issued after Taiwan had officially allowed Mainland institutions to issue RMB bond, and the highest-value bond issuance after RMB-denominated Formosa bond issue was permitted. 

ABC Hong Kong Branch was the issuer of the RMB-denominated Formosa bond. The bond had a term of either three years or five years, with coupon rate of 3.30% and 3.60% respectively, 5BP and 15BP lower than the initial inquiry rate of 3.35% and 3.75%, and 5BP and 15BP lower than Hong Kong bonds with the same credit rating. The issuance had a hot subscription in the market, reflecting the recognition of Taiwan’s institutional investors on ABC brand and strength. 

It was the first bond issued through the Medium-Term Notes mechanism of ABC Hong Kong Branch, with CTBC Bank as the main underwriter. ABC Hong Kong Branch had, on the day of receiving the letter of approval for bond issuance sent by GreTai Securities Market, completed the inquiry and officially announced the pricing.

Under the megatrend of RMB internationalization and the overall background of RMB appreciation, ABC’s successful issuance of RMB-denominated Formosa bond is highly concerned by the market. It not only refreshed many records of issuing bonds in Taiwan by Mainland banks, but also wrote a new chapter for boosting RMB to “go global”.