As related, the first financial bond issued for financial leasing company in the country and lead underwritten by ICBC – 2010 Huarong Financial Leasing Company Financial Bond, was concluded on May 26 with payment on May 27. Total proceeds reached RMB 1 billion. The success marks the beginning of financial leasing company in the country to raise capital through issuance of bonds.

Issuance of financial bonds is a good alternative for financial leasing companies to raise capital from wider channel, besides the conventional indirect way of asking bank loans. According to the announcement from Huarong Financial Leasing Company, the financial bonds in this issue are of 3-year term and 5-year term, offering RMB 500 million in each category. Coupon rates are 3.86% and 4.60% respectively, lower than the loan rate of the same term.

Huarong Financial Leasing Company started the preparation last year, according to ICBC spokesperson. ICBC as the lead underwriter involved all the steps to help Huarong until the offering of the bonds. Today, ICBC, being one of the underwriting institutions in the domestic market with a considerable number of customers, has underwritten financial bonds for many financial institutions covering joint-equity banks, city commercial banks, finance company of the corporate groups and financial leasing companies.

ICBC started to participate in the lead underwriting of financial bond in 2006 and was the earliest commercial bank to embark in this field. As of today, ICBC has underwritten 22 financial bonds for 13 financial institutions. Besides financial bonds, beginning from this year ICBC engages in full force the lead underwriting business of debt instrument such as short-term financing bonds, Mid-Term Notes (MTN) for non-financial companies. ICBC is the largest bond underwriter in China for three years in succession.