China's central bank issued its first offshore renminbi bond in London on Tuesday, in a move that marks a milestone in plans to deepen the offshore renminbi liquidity in London.
The deal was announced today and will be marked by a lunch taking place in London tomorrow to coincide with President Xi Jinping’s first state visit to the UK.
Those present will include Xiaohui Zhang, Assistant Governor of the People’s Bank of China, Bo Li, Director-General of Monetary Policy Department at the PBoC, Chris Salmon, an executive director of the Bank of England and Mark Boleat, chief of policy for the City of London.
The dim sum bonds are worth 5 billion renminbi ($787 million), with an interest rate of 3.1 per cent, and fall due in 2016. This is the first time that renminbi government bonds have been issued outside China, in an attempt to open up an offshore renminbi debt market.
Industrial and Commercial Bank of China (ICBC) and HSBC are joint global coordinators of the deal. Linklaters acted as legal advisor.