Bank of China Hong Kong, a unit of the state giant Bank of China, plans a further issue of subordinated notes due in 2020, it said in a Hong Kong stock exchange filing on Monday. The issue is likely to raise between $600 million and $900 million, a source close to the deal said.
"BOCHK intends to raise further funding through the proposed further issue to early repay part of the remaining outstanding amount of the subordinated credit facility," according to the stock exchange filing. It said the amount outstanding under the credit facility is US $910 million.
In February, Bank of China made a $1.6 billion sale of these 10-year notes which carry a coupon of 5.55 percent at a price of 99.591 cents on the dollar to yield 200 basis points over US Treasuries. BOC International Asia, Deutsche Bank and UBS AG have been appointed lead managers to the issue. The bonds are currently trading at around 100.50 cents on the dollar for a yield of 5.48 percent, according to Reuters data.