Linklaters advised Bank of China Limited on the listing of a bond on the new China International Europe Exchange (CEINEX). The CNY 2 billion bond bearing interest at a rate of 3.6 per cent and maturing in 2017 was issued by the bank’s branch in Abu Dhabi. For this purpose, a stock exchange admission prospectus had been prepared, which was approved by the German Financial Supervisory Authority (BaFin).

The Linklaters team led by Dr Christian Storck once again enters uncharted territory with this transaction. Previous debuts were: the advising of China Construction Bank Corporation (CCB) on the issuance of the first offshore renminbi bond (Goethe bond) in 2014. Moreover, he advised Kartesia Credit Opportunities, a Luxembourg debt fund, as lender of a secured unitranche and Capex bond financing for the acquisition of the German restaurant chain Sausalitos by Ergon Capital Partners. This innovative financing structure was the first of its kind in Germany.

The bond was the first security which was listed on the CEINEX. The bond was issued by Bank of China in the course of the USD 20 billion medium-term note programme and placed on international markets. The bond has already been listed on the NASDAQ in Dubai and quoted on the Singapore Exchange Securities Trading.

CEINEX is a joint venture of Shanghai Stock Exchange, Deutsche Börse and China Financial Futures Exchange. This joint venture gives international investors the opportunity to access investment products which are based on Chinese underlyings. Trading on the new market place, which is the first and only authorised trading platform for Renminbi instruments outside China, commenced on 18 November 2015.

The Linklaters team advising on the transaction was led by Dr Christian Storck (Capital Markets, Frankfurt). The team also included Michael Ng (Capital Markets, Hong Kong), Sebastian Bruchwitz (Investment Management, Frankfurt), William Cresswell, Dr. Alexander Schlee, Olga Bergmann, Nadine Berlander (all Capital Markets, Frankfurt), Vincent Chow (Capital Markets, Hong Kong), Friedrich von Ketteler (Investment Management, Frankfurt), Axel Oehrn (Capital Markets, Frankfurt), Yue Qi (Corporate, Frankfurt), Paul Springstein, Daniel Hannappel, Ann-Kathrin Pfeffer (all Capital Markets, Frankfurt).

Background: Bank of China currently prepares various products for the CEINEX to give investors the opportunity to invest in Chinese securities and the Chinese currency. A product range expansion can be expected in 2016. Linklaters has been advising Bank of China on capital markets law in Hong Kong and Beijing. Linklaters now also advises on the placement and the listing of capital market products in Germany.