One of China’s major state-owned banks has announced the issuance of perpetual bonds to increase its capital levels.
The Agricultural Bank of China (ABC) announced on January 15 that it plans to issue its first round of perpetual bonds on February 18 to raise RMB 50 billion.
In August 2021, ABC received approval from Chinese regulators for an indefinite bond issue quota of RMB 120 billion.
The state lender issued 40 billion yuan of perpetual bonds on November 16, leaving another 30 billion after the issue scheduled for February.
As of September 2021, ABC’s capital adequacy ratio was 16.70% compared to 15.12% at the end of 2018. During the same period, its Tier 1 capital adequacy ratio increased to 12.98% from 12.13%.
ABC said the new issue would allow it to increase its capital adequacy ratio to 16.98% and its Tier 1 capital adequacy ratio to 13.26%.
https://www.chinabankingnews.com/2022/02/16/agricultural-bank-of-china-to-issue-50b-yuan-in-perpetual-bonds/ The Agricultural Bank of China will issue perpetual bonds worth 50 billion yuan