AIIB Debuts $425 Million Panda Bonds to Support Virus Fight

What’s New: China-backed Asian Infrastructure Investment Bank (AIIB) debuted its first panda bonds of 3 billion yuan ($425 million) on China’s interbank market Thursday to support member countries’ fight against the Covid-19 pandemic.

Panda bonds are yuan-denominated bonds sold by non-Chinese issuers in China.

“Funds raised by the issuance will be used to support member countries to deal with the outbreak,” said Jin Liqun, president and chairman of the bank. “In the longer term, it will support AIIB’s investment in sustainable infrastructure projects.”

The three-year bonds have a coupon rate of 2.4% and were 2.78 times oversubscribed. China’s domestic investors subscribed for 35% of the issuance while overseas investors took the remaining 65%.

Get More: The AIIB in May revealed a plan to sell panda bonds in China for the first time since its establishment five years ago. Jin called the issuance a milestone that will offer an important reference for AIIB’s future bond financing in China’s capital market.

Part of the proceeds will be invested in the bank’s newly formed $10 billion crisis response fund to support recovery from the pandemic. The bank has provided emergency financing to member countries including China, India, Pakistan, Indonesia, the Philippines, Georgia and Bangladesh to help with disease control.

The AIIB has 102 members worldwide and has approved investments in 71 projects totaling nearly $14.3 billion, according to its website.

Quick Takes are condensed versions of China-related stories for fast news you can use. To read the full story in Chinese, click here.

Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bobsimison@caixin.com)

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