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BOC to sell 40b yuan convertible bonds

By Nie Peng (chinadaily.com.cn)
Updated: 2010-03-22 11:47

Bank of China (BOC) said in a March 20 statement that its shareholders have given the go-ahead to its plan to sell convertible bonds (CBs) of up to 40 billion yuan, China Business News reported Monday.

According to the plan passed at a shareholders' meeting on March 19, the bank will issue on the domestic A-share market six-year CBs of up to 40 billion yuan at coupon rates not higher than 3 percent. The bank hasn't given the timetable for the selling yet.

Earlier this month, Xiao Gang, chairman of the bank, had said that the bank would need no fundraising on the A-share market in the next two years after completing the 40 billion yuan CB placement.

Central Huijin Investment Co, which holds 67.5 percent of the bank's A shares, will not subscribe to the new CBs, the bank's management had said earlier. Central Huijin is the domestic investment arm of China's sovereign wealth fund.

The bank's shareholders also authorized its board of directors to issue separately or simultaneously with the bonds not more than 35.6 billion A shares and 15.3 billion H shares.

Responding to media speculation that the bank was in talks with investment banks to sell $7 billion new H shares, Xiao said at the shareholders' meeting that the bank would adopt a detailed fundraising plan on the Hong Kong market later.