Foreign Currency & Financing Overseas

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Foreign Currency & Financing Overseas

Through dedicated efforts over the years, CDB developed a highly integrated foreign exchange financing model covering forex capital injection, foreign currency bond issuance, foreign exchange lending, foreign currency deposit, etc. enabling it to contribute actively to the development of international cooperation projects. As such, the bank has established itself as one of the major banking service providers in China for outbound investment and financing projects.

CDB is the largest issuer of foreign currency bonds in China's bond market. In line with the government's call for active utilization of foreign exchange capital available in China, it took the lead in publicly offering China's first foreign currency financial bond in 2003, with the total value of US$ 500mn and a maturity of five years. It was followed by a series of USD bond issues within China thereafter. In 2015, CDB issued two onshore USD bonds totaling US$ 2 billion in the Chinese interbank market, making it the largest Chinese bond issuer in the year. As of the end of 2015, an aggregate of US$ 12.4 billion worth of USD bonds had been issued, accounting for over 70% of the market total.

CDB also has a solid track record of successful bond issuance overseas. In 1996, it made the first fundraising in the global capital market by issuing the offshore JPY-30bn Samurai bond, which was followed by the first CDB Yankee bond, global USD bond and euro bond in 1997, 2004 and 2005, respectively. All bonds issued by CDB were warmly received by global investors worldwide in recognition of its quasi-sovereign debt status, outstanding performance and extensive bond-issuing experience, further enhancing its position and influence on the global capital market. In 2015, CDB successfully issued a US$ 1 billion USD bond and an EUR 500 million EUR bond, ten years after its last offshore bond issuance.

CDB also played an active role in RMB internationalization. It issued the first offshore RMB bond of RMB 5bn (commonly known as the "dim sum bond") during the 10th anniversary of the return of Hong Kong to China in 2007. It was hailed as "a new milestone in financial cooperation between Hong Kong and the Mainland". As of the end of 2015, RMB 28bn worth of offshore RMB bonds had been issued aggregately by CDB, with maturities ranging from 2 to 20 years, making it the largest financial institution issuer in terms of bond issue size, outstanding bond balance and bond variety coverage. As well as receiving active bond subscriptions, CDB has won a large number of prestigious international awards including "best issuer", "best bond deal", etc. by International Financing Review (Thomson Reuters), MTN-I (Europe) and The Asset (Hong Kong). In particular, during the Sixth China-UK Financial Dialogue held in September 2014, CDB issued the first RMB-2bn bond in London. As the first Chinese quasi-sovereign bond ever issued outside China, the bond issue had profound and far-reaching implications.