Linklaters counsels PBOC on issuance


Linklaters advised the People’s Bank of China (PBOC) in its US$1.43 billion (RMB10 billion) six-month bills issue on 26 March in Hong Kong through the tendering platform CMU BID, operated by the Hong Kong Monetary Authority (HKMA).

The bills are set to mature in six months, with an interest rate of 2.9%. Despite the recent volatility in global financial markets, the issuance was well received by investors from the offshore markets of many countries and regions including Europe, North America and Asia, demonstrating global investor confidence in renminbi (RMB) assets, as well as the Chinese economy.

The total bid amount was more than US$4.94 billion, covering the offering 3.5 times. This was the second successful issuance of bills by China’s central bank in Hong Kong this year.

The stable and continual issuance of renminbi central bank bills in Hong Kong helps cultivate a range of RMB investment products with high credit ratings and RMB liquidity management tools in the city’s market, meets the needs of investors in offshore markets, improves the offshore RMB yield curve, promotes the development of the offshore RMB money market, and drives other issuers to issue RMB bonds in the offshore market to promote the internationalization of the RMB.

The team was led by the head of China, William Liu, with capital markets partner Sherry Cui.

Linklaters previously acted as international legal adviser to the PBOC on its first issuance of RMB bills in London, in 2015. The firm participated in all bill offerings by the PBOC since its first issuance of RMB bills through the HKMA tendering platform in November 2018, amounting to a total of 17 tranches with a sum total of $US29.66 billion to date.