DBS Bank Ltd. (DBS), acting as the Joint Green Structure Advisor and Joint Global Coordinator, helped Henan Railway Construction & Investment Group Co., Ltd. (Henan RCIC) price three-year USD$400 million senior unsecured green bonds, with a final yield rate at 2.2% (same as the coupon rate). The order book peaked at total volume of US$1.65 billion during the announcement of the final price guidance.
DBS, also acting as the Moody’s rating advisor, assisted Henan RCIC in obtaining an A2 (stable) rating from Moody’s. At the same time, DBS helped Henan RCIC in building its Green Financing Framework, which received a second opinion from S&P, confirming its compliance with the ICMA Green Bond Principles (2021) and LMA Green Loan Principles (2021). The funds raised from the green bonds will be further deployed to by Henan RCIC to promote the green and low-carbon transformation of transportation as part of efforts to fulfill China’s target of “carbon peak” and “carbon neutrality”.
Henan RCIC is the only provincial-level railroad investment and construction organization in Henan Province, undertaking the responsibility for investment, financing, construction, management and comprehensive development of the railroad and other transportation infrastructure in the province. As of end 2020, Henan RCIC invested in the construction of 23 railway projects, with a total railroad coverage of 3,716 km. The company has now incorporated the concept of green development into the design, construction, operations and management of railways, aimed at promoting and implementing low-carbon transportation solutions.
The successful issuance of green bonds effectively reduces financing costs. On top of that, it is also the highest international rating obtained by any rated railway construction company in China, thus laying a solid foundation for Henan RCIC to make its debut in the international market.
“This is the first green USD bond by a State-Owned Enterprise in Henan Province. The successful issuance of this bond is conducive to the Group’s continued progress in green development, at the same time, improving corporate governance structure and reinforce social responsibility,” said Mr. Yue Guoyong, Chairman of Henan RCIC. “It is also an important foundation for the Group to further develop and tap into the international financial markets and accelerate the building of its ‘one core with four driving forces’ strategy.”
DBS Bank has a long history of exploring and building diversified, broad-coverage, sustainable financial services models and financial services businesses. The bank has provided a range of solutions, including green loans, green bonds, green supply chains and green deposits, to a number of Chinese companies. The bank released the world’s first Sustainable and Transition Finance Framework and Taxonomy in 2020 as part of its commitment to work with clients in key sectors to transition to a low-carbon economy.
At the same time, DBS announced in 2021 that it would more than double its sustainable finance target from SDG20 billion to SDG50 billion by 2024. This sets the stage for DBS to strengthen collaboration with clients pushing forward with their sustainability goals.
About DBS DBS is a leading financial services group in Asia with a presence in 18 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank's "AA-" and "Aa1" credit ratings are among the highest in the world. Recognised for its global leadership, DBS has been named “World’s Best Bank” by Euromoney, “Global Bank of the Year” by The Banker and “Best Bank in the World” by Global Finance. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank” by Euromoney and the world’s “Most Innovative in Digital Banking” by The Banker. In addition, DBS has been accorded the “Safest Bank in Asia” award by Global Finance for 13 consecutive years from 2009 to 2021. DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets. DBS is committed to building lasting relationships with customers, and positively impacting communities through supporting social enterprises, as it banks the Asian way. It has also established a SGD 50 million foundation to strengthen its corporate social responsibility efforts in Singapore and across Asia. With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. For more information, please visit www.dbs.com.
