ICBC has recently issued the first tier-2 capital bonds in the overseas capital market. The terms and conditions of the bonds complied with the Basel III and relevant requirements of the CBRC. All the proceeds from the issue would be used to replenish the Bank’s tier-2 capital.

The size of this issue was USD 2 billion, with maturity of ten years. During the issue, t the bonds were well received by global investors and garnered premium orders from around 180 investors worldwide, nearly two times oversubscribed. The final issue price was at the lower end of the price range and the cost of the issue was lower than that of tier-2 capital bonds with the same maturity issued by the same type of institutions. The investors, by structure, mainly included insurance companies, fund and asset management companies and commercial banks, among which insurance companies accounted for 37%, fund and asset management companies 33%, banks 20%, sovereign funds 6%, private banks and other institutions 4%. By geographical distribution, 83% of the investors were from Asia, 10% from America and 7% from Europe.

According to an ICBC official, this issue, as a capital replenishment tool, was another move by the Bank to tap overseas capital markets, following its issue of overseas preferred shares last year, which demonstrated the Bank’s enhanced capability to leverage global capital markets.