Following the recent renminbi-denominated bond issuances by Chinese banks in both Frankfurt and Luxembourg, competition to lead the offshore market in the Chinese currency has gained new life, with both financial centres aiming to become the hub in continental Europe for renminbi issuers.
Agricultural Bank of China’s Hong Kong branch placed Rmb1.2bn ($19.2m) two-year notes, yielding 3.25%, on the Frankfurt Stock Exchange (part of Deutsche Boerse), marking the first issuance by a Chinese bank to be listed in Germany. Meanwhile, the Bank of China’s Luxembourg branch issued its first ‘Schengen’ bond on the Euro Multilateral Trading Facility market, part of the Luxembourg Stock Exchange. It was a Rmb1.5bn three-year bond, yielding 3.5%. Both products were priced on the same day, in early May 2014.