Beijing/Brussels/Shanghai, 4 February 2021 – Euroclear Bank, the Brussels based International Central Securities Depository (ICSD) is pleased to announce that the Bank of China has become the first issuer to utilise its recently launched Yulan bond structure. The issuance was priced at $500 million with a tenor of three years and was four times oversubscribed.

Euroclear Bank’s Yulan bonds are issued through Shanghai Clearing House with international investors able to benefit from real time multi-currency DVP settlement with any counterparty within Euroclear Bank’s network. With these Yulan bonds, Chinese issuers are now able to gain direct exposure to a wider foreign investor base, reaping the benefits of a greater liquidity pool and improved cost efficiencies.

Zhou Quan, Head of Asset and Liability Management Bank of China said: “In our role as one of the largest financial institutions in China, we are committed to supporting innovative initiatives that will benefit offshore and onshore bond markets and promote China´s “dual circulation” development pattern. We are pleased to be the first issuer of the Yulan bond co-created by Euroclear and Shanghai Clearing House. We expect that this bond structure will yield further success and anticipate that this new generation of bonds will bring increased efficiencies and convenience to issuers and investors globally.”

Wang Hong Bo, Deputy General Manager of Shanghai Clearing House commented:  “We would like to congratulate Bank of China on the issuance of the first Yulan bond! With the guidance of regulatory authorities, Shanghai Clearing House will continue to work together with Euroclear Bank to improve market efficiencies, by exploring cross-border cooperation to facilitate easier access for domestic and overseas market participants.”

Stephan Pouyat, Global Head of Capital Markets and Funds Services at Euroclear added: “This issuance by the Bank of China is the culmination of a long standing  relationship with the Chinese market. Through a shared goal of building a new issuance model that enables increased foreign investment into the market, we are seeing true demand for this service. For the first time, international investors have full Euroclearable access to mainland Chinese securities. An issuance of this importance is a fantastic way to start 2021 as we continue to add momentum.”

Note to editors

About Euroclear Bank

Euroclear Bank provides settlement and related securities services for cross-border transactions involving domestic and international bonds, equities, derivatives and investment funds. Serving major financial institutions located in more than 90 countries, Euroclear Bank, based in Brussels, is part of the Euroclear group. Euroclear Bank is rated AA+ by Fitch Ratings and AA by Standard & Poor’s.

As well as Euroclear Bank, the Euroclear group includes Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden and Euroclear UK & Ireland. The Euroclear group settled the equivalent of EUR 837 trillion in securities transactions in 2019, representing 239 million domestic and cross-border transactions and held an average of EUR 30.1 trillion in assets for clients.

About Bank of China

Bank of China is one of the four biggest state-owned commercial banks in China with the longest continuous operation among Chinese banks. As China’s most globalised and integrated bank, Bank of China has a well-established global service network with institutions set up across the Chinese mainland as well as in 57 countries and regions. It has established an integrated service platform based on the pillars of its corporate banking, personal banking, financial markets and other commercial banking business, which covers investment banking, direct investment, securities, insurance, funds, aircraft leasing and other areas.

About Shanghai Clearing House

Shanghai Clearing House (SHCH) was established on November 28, 2009. It is a systemically important financial market infrastructure regulated by the People's Bank of China (PBC). It is one of the Central Securities Depositories (CSD) in China and also recognized as a Qualified Central Counterparty (QCCP) by PBC.

Committed to becoming a "standardized, market-oriented and internationalized" institution, SHCH actively pushes forward registration, custody and settlement services as well as CCP clearing at the same time. At present, SHCH provides a one-stop solution of registration, custody and settlement services for innovative financial products, such as corporate credit bonds, financial bonds, money market instruments and structured products. SHCH has established a CCP clearing service system in China's OTC financial market, covering bonds, interest rate, foreign exchange, commodity and credit derivatives. In 2019, custody balance by the end of the year amounted to 22.4 trillion RMB and the amount of clearing business of SHCH reached 363.0 trillion RMB.

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"For the first time, international investors have full Euroclearable access to mainland Chinese securities"

Stephan Pouyat, Global Head of Capital Markets and Funds Services, Euroclear

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