HONG KONG Nov 1 The Canadian province of
British Columbia completed the sale of a 2.5 billion yuan
($410.21 million) one-year dim sum bond on Friday, with central
banks taking the lion's share of the offering.
The offshore yuan bond, expected to carry an Aaa rating, was
priced at 2.25 percent with order books exceeding 4 billion yuan
from 42 investors, according to a term sheet seen by Reuters.
Among the buyers, central banks and foreign institutions
accounted for 62 percent, followed by fund and asset managers at
18 percent, corporates at 10 percent, banks 7 percent and
private banks 3 percent.
Asian and U.S. investors took 59 percent and 40 percent of
the bond, respectively, with the rest allocated to European
investors, the term sheet showed.
Foreign central banks have not been frequent investors in
dim sum bonds but have at times in the past bid for very high
quality names with the purpose of diversifying their investment
For example, the 13 billion yuan jumbo dim sum bond issued
by China's Ministry of Finance in June had a tranche reserved
for central banks, which was well received and saw eight central
banks participating, with names from Asia, South America and
Earlier in March, when China Minmetals Corporation, a
state-owned enterprise, sold a 2.5 billion yuan three-year bond,
it also attracted foreign central banks to take 16 percent of
British Columbia's dim sum bond will be listed in
Luxembourg. HSBC is the sole bookrunner of the transaction. Bank
of China and Industrial and Commercial Bank of China are
China is sparing no effort in promoting the wider use of its
currency by launching a slew of pilot schemes, with the aim of
eventually elevating the status of the "redback" on par with the
Some foreign central banks, such as South Korea and Japan,
have also started to put the yuan assets as part of their
foreign exchange reserves by investing in China's onshore bond
market as well as dim sum bonds.
China has signed currency swap lines with 21 countries with
a total value of more than 2 trillion yuan as part of efforts to
encourage the use of the yuan in cross-border trade and