United Overseas Bank (UOB) has priced RMB5 billion ($923.4 million worth of renminbi bonds. The bonds will mature three years from its issue date, which is expected to be Oct 22, and will carry a coupon of 2.3% per annum, payable annually in arrear.
This is the bank’s first panda bond since 2019, says the bank in its Oct 22 announcement.
According to China Chengxin International Credit Rating Co’s rating report dated July 1, UOB has an onshore credit rating of “AAA”. The credit rating agency has also assigned the bonds an onshore credit rating of “AAA”.
In its release, UOB notes that the offering saw strong demand as it garnered a subscription ratio of 1.73 from both onshore and offshore investors. New investors accounted for 20% of the allocations.
UOB will apply for the bond to be listed on the Singapore Exchange S68 (SGX), subject to regulatory approval. The listing will also mark the first time a financial institution lists a panda bond on the exchange.
“We have always been excited to participate in the growth of the panda bond market. We were the first Singaporean panda issuer in 2019 and riding on the back of the rapidly-growing capacity of this market, our latest issuance is also the largest from a foreign financial issuer with a three-year tenor,” says Koh Chin Chin, head of group treasury, research and customer advocacy at UOB.
See also: Banks in Singapore can withstand multiple shocks: MAS
As at 4.19pm, UOB shares are trading 25 cents lower or 0.77% down at $32.23.
