China’s only rural policy bank has become the first non-government issuer to sell a listed bond to retail investors through Hong Kong’s major exchange.
The Agricultural Development Bank of China issued a one-year yuan-dominated bond worth 2 billion yuan ($289.4 million) on Wednesday, of which 200 million yuan was sold to retail investors, Hong Kong Exchanges (HKEX) said in a press release. The bank issued the bond through the exchange operator’s Central Clearing and Settlement System.
The bond issuance marks Hong Kong’s latest bid to diversify its fixed-income markets.
The credit rating of the bank, one of China’s three policy lenders, is almost like a sovereign credit rating, so a simplified information disclosure procedure can apply to its bond issuance, HKEX Chief Executive Charles Li said at a briefing Thursday.
In the long run, HKEX aims to include listed bonds and derivatives in the mutual market access mechanism between the Chinese mainland and Hong Kong, Li said. China has launched a bond connect program and two stock connect programs to allow investors from both the mainland and overseas to trade each other’s bonds and stocks.