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CDB’s Poverty-alleviation Special Financial Bond on Sale at ICBC on April 25

ICBC concurrently sold two bonds of China Development Bank (CDB), i.e., CDB’s seventh and eighth tranches of financial bonds in 2018, to personal customers and non-financial institutional customers on April 25-26. The seventh tranche of financial bond in 2018 is a one-year coupon bond with fixed interest rate, and the eighth tranche of financial bond is a newly issued three-year poverty-alleviation special financial bond with fixed interest rate. These two financial bonds are available for customers through e-banking and outlets of ICBC, of which online channels will provide around-the-clock sale services during the period of issuance.

It is learned that, the eighth tranche of financial bond newly issued by CDB in 2018 via the over-the-counter (OTC) market is a three-year fixed-rate special financial bond for poverty alleviation. The bonds are abbreviated as 18 CDB 08, with bond code of 180208. The face value is RMB100 and the coupon rate is 4.07%. The funds raised will be used to grant long-term loans following the low-profit or break-even principle, to support the 36 projects for relocation and poverty alleviation in 13 provinces (or autonomous regions/municipality) including Hebei Province, Inner Mongolia Autonomous Region, Jilin Province, Shandong Province, Henan Province, Hunan Province, Guangxi Zhuang Autonomous Region, Chongqing Municipality, Sichuan Province, Guizhou Province, Gansu Province, Ningxia Hui Autonomous Region and Xinjiang Uygur Autonomous Region, covering a total of around 940,000 registered impoverished people, and greatly contributing to the public welfare. In order to encourage public investment, ICBC, along with the CDB, will also issue commemorative certificates for the first 500 individual investors who subscribe for the bonds and complete information registration.

The seventh tranche of financial bond in 2018 reissued for the first time by CDB via the OTC market is a one-year coupon bond with fixed interest rate. The bond is abbreviated as 18 CDB 07, with bond code of 180207 and face value of RMB100. Its value date, payment arrangement, coupon rate, trading and custody methods etc. are the same as other tranches of CDB bonds over the same period. With a coupon rate of 3.57% and a reissuance price of RMB100.16/RMB100 face value, this bond has a yield-to-maturity rate of 3.5005% for reference.

According to an official of ICBC, CDB bond issuance via the counter is an investment trading product with high security, good profitability, strong liquidity, and low investment threshold. The trading threshold and minimum increment for a single bond transaction are both RMB100 in face value. The issuance of this poverty-alleviation bonds via the counter will not only expand the sources of poverty alleviation funds, but also channel social capital into the key areas of poverty alleviation. In addition, it will open up new channels of prudent investment for the public, and promote the development of a multi-tiered bond market system.