Recently, the Industrial and Commercial Bank of China (ICBC) successfully issued Tier 2 capital bonds overseas on the terms of the bonds in conformity with the Basel III rules and the relevant rules implemented by the CBRC. The proceeds from this bond issuance will be fully used to top up its Tier 2 capital.
The Tier 2 capital bonds issued by ICBC amounted to USD 2 billion, with a fixed tenor of 10 years. Due to strong demand from global investors, this bond issuance was approximately twice over-subscribed by about 180 investors world wide, and was successfully priced at the lowest end of the pricing range. The costs of this bond issue were lower than the Tier 2 capital bonds issued by equivalent institutions with the same tenor.
This is the second time ICBC has issued supplementary capital instruments in the overseas capital market since last year, when it issued preferred stocks overseas.
Following last years’ participation in ICBC’s overseas issuance of preferred stocks, JunHe represented the underwriter in this project, acting as its PRC counsel to conduct legal due diligence investigation, review transaction documents, issue legal opinions and offer advice with respect to the laws of the PRC.
Partner YU, Yongqiang (YY) led this project.