China Development Bank to Issue up to USD$1.43 Billion in Climate Change Green Bonds


One of China’s key policy banks has unveiled plans to sell a raft of “climate change response” green bonds to global investors at the end of July.

On 29 July the China Development Bank (CBD) announced that it would be issuing its first batch of “Climate Change Response” (“应对气候变化) green bonds to global investors in multiple markets simultaneously.

The 10 billion yuan (USD$1.43 billion) issue will be the first bond issue in China of instruments which has obtained certification under the Climate Bonds Standard, as well as the first trial issue of a bond in both the interbank and exchange markets simultaneously.

All funds raised by the issue will be used for green projects including low carbon transit, which are expected to achieve a reduction in standard coal usage of 413,000 tones per annum, and an annual reduction in C02 emissions of 912,000 tonnes.

CBD said that it expects the green projects to “help raise the level of urban infrastructure, create an integrated transit network in the urbanised parts of the Yangtze River Delta, and service the integrated, high-quality growth of the Yangtze River Delta.”

The minimum investment sum will be 100 yuan, while the subscription yield is expected to be around 2.8%.

The bonds will have a term of two years, with interest calculations set to commence on 6 August 2020 and a redemption date scheduled for 21 November 2022.

As one of the underwriters Industrial Bank Co., Ltd. will commence sale of the bonds to individual and enterprise investors on 30 July, via channels including mobile banking and online banking platforms, as well as over-the-counter sales.

The bonds will be listed on 10 August, with transactions subsequently permitted on all trading days from 10:00 to 15:30 via mobile and online channels, as well as over the counter.

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