The Asian Development Bank(ADB) on Monday launched its debut yuan-denominated Panda bonds in China's domestic capital market, the Manila-based bank said in a statement released here.
The issue will have a principal amount of one billion yuan, a bullet maturity of 10 years, and a fixed coupon rate payable annually.
ADB and lead manager BOC International (China) Ltd will undertake roadshows on Tuesday and Wednesday in Shanghai and Beijing, respectively.
Bookbuilding will follow immediately and pricing will take place no later than Thursday, 13 October, the statement said.
The bonds will be issued in the interbank market with clearing and settlement through The China Government Securities Depository Trust and Clearing Co, Ltd.
"We are pleased to be able to launch this pioneering transaction soon after receiving the necessary approval from the Peoples Bank of China," Mikio Kashiwagi, ADBs Treasurer said in the statement.
The ADB will use the proceeds for funding private sector development projects.
The objective is to help reduce the currency risks for private enterprises who have no foreign exchange earnings, the ADB statement said.
After India and the Philippines, China is the third country where ADB plans to undertake local currency financing.
Since early 2004, ADB has completed three market-opening transactions in the regions local currency bond markets, including India, Malaysia, and Thailand. China's bond market has expanded significantly since the late 1990s, the ADB said.
"Early this year China had a total of 600 billion dollars in bonds outstanding, almost five times the amount in 1997," the ADB said.
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