Evergrade Real Estate Appoints Citi as Trustee and Agent for Landmark CNY 9.25 Billion Synthetic RMB Bond
Hong Kong - March 2, 2011 – Citi’s Agency and Trust business, part of the Global Transaction Services division, has been appointed as trustee and agent for Evergrande Real Estate Group’s CNY 9.25 billion (USD 1.4 billion) dual-tranche synthetic offshore RMB bond. Synthetic RMB bonds are denominated in RMB, but settled in US dollars, allowing international investors to book exposure to the Chinese currency.
The record-breaking deal is the largest offering of a synthetic RMB bond ever and is the biggest Asian high-yield bond in history. The issue was also 3.6 times oversubscribed, with more than CNY 33 billion of orders, signaling strong investor demand.
"Evergrande selected Citi due to its strong market credentials and expertise with handling offshore RMB transactions. Citi’s experienced staff and on-the-ground expertise across multiple jurisdictions provided invaluable counsel to Evergrande and ensured the transaction was executed flawlessly," said Jimmy Fong, Group Vice President, Evergrande Real Estate Group.
Citi has been appointed note trustee, principal paying agent, shared security agent, registrar and transfer agent by Evergrande to facilitate issuance and the ongoing administration of the bond.
As trustee and paying agent, Citi will service all principal and interest payments on behalf of the issuer for the life of the transaction. As security agent, Citi will hold collateral consisting of share pledges from over 20 offshore subsidiaries of the issuer.
"The offshore RMB market is clearly becoming a growing funding tool for our clients. This transaction breaks several records and is further evidence of the international markets enthusiasm for RMB bonds and Chinese currency exposure," said David Russell, Managing Director, Regional Head, Asia Pacific, Securities and Funds Services, Citi. "Citi’s market leadership in this space is a testament to its unmatched network and capabilities, which enable clients to seamlessly gain access to capital markets across the globe."
In addition to bond administration, Citi’s Agency and Trust business has recently launched a number of new product enhancements to support offshore RMB transactions. Covering RMB bonds, loans, escrows and structured finance transactions, these new capabilities allow Citi’s clients to access the growing RMB market both in Hong Kong and internationally.
Citi’s Agency and Trust provides innovative banking solutions to financial institutions, corporate clients and public sector entities. Spanning a network of over 70 countries, the business offers a full range of agency, fiduciary, tender and exchange, depository and escrow services, administering over US$4 trillion in fixed income and equity securities on behalf of 2,800 clients.
Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Through Citicorp and Citi Holdings, Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management. Additional information may be found at www.citigroup.com or www.citi.com.
About Global Transaction Services
Global Transaction Services, a division of Citi’s Institutional Clients Group, offers integrated cash management, trade, and securities and fund services to multinational corporations, financial institutions and public sector organizations around the world. With a network that spans more than 100 countries, Citi’s Global Transaction Services supports over 65,000 clients. As of the fourth quarter of 2010, it held $353 billion in liability balances and $12.6 trillion in assets under custody.