China’s successful debut in Canada’s sovereign green bond market is expected to broaden the global reach of offshore yuan assets and strengthen the Chinese currency’s role in North American financing and investment, according to executives of the banks involved in the issuance.
The 4 billion yuan ($599 million) offering attracted strong demand from international investors, with total orders reaching 54.04 billion yuan, or 13.5 times the amount issued. The oversubscription highlights growing investor appetite for yuan-denominated green assets and confidence in China’s sovereign creditworthiness, the bankers said.
Jerry Zhang, global head of RMB commercialisation and global head of banks and brokers dealers at Standard Chartered, said that against a backdrop of increasingly diversified global asset allocation, the issuance sends a clear signal of China’s continued commitment to expanding financial opening-up and advancing the internationalization of the yuan.
“The offering will help enhance global recognition of yuan-denominated assets and their appeal to investors, while contributing to the further development of the offshore yuan ecosystem,” Zhang said.
“Strong investor demand also underscores the international capital market’s high regard for China’s sovereign creditworthiness and its confidence in the long-term investment value of yuan assets,” she added.
Mark Wang, president and chief executive officer of HSBC China, said the issuance marks another important step in China-Canada financial cooperation, following the renewal of the bilateral local currency swap agreement between the two countries’ central banks in January. It also provides fresh impetus for sustainable development.
“The bonds attracted strong market demand, with the oversubscription ratio reaching a record high for the Ministry of Finance’s offshore yuan sovereign bond issuances in recent years. The offering also brought in new investors, demonstrating international investors’ firm confidence in China’s sovereign creditworthiness and further highlighting the market appeal of offshore yuan assets,” Wang said.
He added that China’s sovereign green bond issuance is gaining momentum, with both offerings this year oversubscribed. This reflects the growing importance of Chinese green assets in the global sustainable investment landscape. As issuance expands from London and Hong Kong to Toronto, more international capital focused on environmental, social and governance considerations is being drawn into the pool of offshore yuan-denominated green assets, supporting sustainable development through collective investment.
China’s Ministry of Finance issued the 4 billion yuan in sovereign green bonds in Toronto on Nov 9 local time, marking its first-ever sale of yuan-denominated sovereign green bonds in Canada and the first offshore yuan-denominated sovereign green sovereign bond offering in North America.
The issuance also represents an important step in implementing the outcomes of the second China-Canada Economic and Financial Strategic Dialogue and is expected to deepen bilateral cooperation in green development and economic and financial affairs.
The offering comprised two tranches: 2 billion yuan in three-year bonds at a yield of 1.4 percent and 2 billion yuan in five-year bonds at a yield of 1.5 percent. The bonds will be listed on the Hong Kong stock exchange.
The investor base was geographically diverse, with Asia-Pacific investors accounting for 77 percent of the total and those from other regions making up the remaining 23 percent, including 15 percent from the Americas and 8 percent from Europe.
By investor type, banks accounted for 45 percent of the allocation, followed by sovereign and supranational institutions at 32 percent, fund managers, asset managers and insurers at 22 percent, and dealers at 1 percent. Green and sustainable investors represented 41 percent of the total, according to the ministry.
Bank of China acted as a joint lead underwriter, green structuring adviser and principal clearing bank for the issuance. Since the Ministry of Finance released the People’s Republic of China Sovereign Green Bond Framework in 2025, the bank has supported the ministry in issuing a total of 16 billion yuan in sovereign green bonds in markets including London and Hong Kong over the past two years.
Standard Chartered served as a joint lead underwriter, while HSBC acted as a joint lead underwriter and joint bookrunner.
