United Overseas Bank (UOB) has successfully issued a RMB 5b three-year Panda bond at a coupon rate of 1.83%, marking its third entry into the Panda bond market since 2019. This issuance, which is the joint largest for a three-year tenor among foreign banks, highlights UOB’s ongoing commitment to the Chinese capital markets. The bond is set to be listed on the Singapore Exchange, pending regulatory approval.
The offering received robust demand, with a subscription ratio of 1.6 times, drawing interest from both onshore and offshore investors. Onshore investors accounted for 78% of the uptake, whilst offshore investors comprised 22%. The final coupon rate of 1.83% represents a spread of 22 basis points over the three-year China Development Bank benchmark bond yield, one of the lowest for an international issuer in the Panda bond market.
Koh Chin Chin, UOB’s Head of Group Treasury, Research and Customer Advocacy, expressed satisfaction with the issuance, stating, “We’re pleased to complete our CNY5b Panda bond issuance with strong investor support. As a repeat issuer, we appreciate the depth and resilience of the onshore RMB market.”
The bond issuance comes at a time when the US markets are largely closed due to geopolitical volatility, yet the onshore RMB market remains stable. The proceeds from the bond will be used to support UOB’s general banking business in Hong Kong and ASEAN, particularly for enterprises with ties to the PRC.
