BOC sells landmark $6.5b bank capital note

Lender raises the largest ever dollar-denominated bank capital offering, building up capital cushions to counter China’s mounting bad debt problem.
Bank of China, the fourth biggest lender by market value
Bank of China, the fourth biggest lender by market value

Bank of China has raised a $6.5 billion Basel III-compliant Additional Tier 1 note the biggest single tranche dollar-denominated bank capital sale ever boosting much-needed capital buffers to counter China’s growing non-performing loans issue.

The bond the first offshore preference share offering from a Chinese company received a whopping order book of $21.8 billion from more than 200 accounts, according to a source close to the deal. This enabled the issuer to tighten its pricing from an initial price guidance range of between 6.875% to 7% to a final price of 6.75%.

BOC’s debut dollar-denominated AT1 offering had guaranteed orders of $14 billion before...

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