Chinese perpetual bonds: capital idea

Bank of China’s landmark onshore perpetual bond deal opens up a new fundraising avenue for the capital-strapped banking sector.
When the credits roll on 2019, there is one bond offering that will almost be certainly viewed as one of the year’s defining transactions and that is last Friday’s Rmb40billion $5.9 billion perpetual by Bank of China. 
 
The deal was symbolic on a number of levels, not least because it has created an important new financing option for Chinese banks as they seek to bolster their capital ratios to meet tougher regulatory minimum levels and boost private sector lending.  
 
Prior to Friday, Chinese banks could raise additional tier 1 capital AT1 onshore, but they had...
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