Breaking: ADBC Issues First in EUR500m Green & Sustainability Bond: Offshore Listing: Strong Demand: Second-and Third-Party Opinions posted

Posted: Nov 21, 2018

Another big Chinese bank comes to market with a green offering 

Multiple projects: pollution control, clean energy, ecological protection and climate change adaptation

Agricultural Development Bank of China (ADBC) has issued another benchmark size green bond in acccordance with their 'ADBC Green and Sustainability Bond Framework'. 

As reported the bond was 3.4 times oversubscribed with 58% allocated to European investors.   

The EUR500m bond is their first issued in EUR and is proposed to list across Hong Kong Stock Exchange, Luxembourg Stock Exchange and China Europe International Exchange. 

ADBC is the only agricultural policy bank in China. The bank aims to function with sustainable development capabilities, working to channel financial services to 5 sectors: national food security, poverty alleviation, agricultural modernisation, integrated urban and rural development and nationwide regional development strategy. 

Previous ADBC green issues include a CNY6bn (USD863bn) in Dec 2016, we covered it in our Market Blog at the time.  

Second Party opinion is jointly provided by Centre for International Climate and Environmental Research Oslo (CICERO) and International Institute of Sustainable Development (IISD). 

It's labelled a Green and Sustainability Bond, aiming at climate change and linking to UN SDGs. CICERO and IISD have categorised ADBC's green bond framework as ‘dark green’ and the sustainability bond framework rated as ‘medium green’. 

Third-party report was provided by CECEP Consulting Co., Ltd. who have had an increasingly active presence in the Chinese market post the 2016 Beijing G20. 

 

ADBC not ABC 

Not to be confused with the Agricultural Bank of China (ABC), ADBC is a policy bank. 

The term ‘policy bank’ might not mean much to our non-Chinese audience but it is an important distinction. In 1994 the Chinese government established three policymaking banks, each of which is dedicated to a specific lending purpose. Agricultural Development Bank of China (ADBC), the China Development Bank (CDB) and the Export-Import Bank of China (Exim Bank) make up the trio. 

 

The Last Word 

This bond is the latest in the growing trend of green issuance from giant Chinese banks we’ve seen in 2018. Large deal sizes, offshore listings and strong demand from global investors has marked with the previous offerings. 

We’ll keep you updated as other major issuances emerge. 

 

‘Till next time,

Climate Bonds.

            

 

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