Bank of China is planning to expand its offshore bond business with an eye on more fundraising denominated in U.S. dollars and the euro.
From a headcount of around 50, Bank of China (BOC) will make an additional 40 percent boost by adding 20 more over the next five years, according to a «Bloomberg» report citing Hu Kun, general manager of investment banking and asset management.
BOC’s offshore bond team currently has offices spanning across Hong Kong, Singapore and London, covering deals in Asia, Europe, the Middle East and Africa.
Hu said he saw room for improvement in debt capital market-related services, such as settlement, market-making and credit research.
Big Tech
Through the expansion, the state-owned lender will focus on two areas: big tech issuances in U.S. dollars and euro-denominated issuances.
«It is quite a natural choice for tech firms to pick international banks to arrange their bond deals, which sponsored their IPO in the offshore market,» said Hu. «Indeed, as a Chinese bank, we are striving to get more deals from this sector.»
Euro Bonds
On the latter area, Hu said he expected more expansion of funding channels from Chinese firms, particularly to diversity away from the dollar due to rising U.S.-China tensions.
In the third quarter this year, Chinese borrowers sold 4.63 billion euros ($5.5 billion) of notes, according to «Bloomberg» data – a record-high quarterly amount denominated in the currency.
«Our investment in human resources will be based on the rapid growth of the offshore bond market and BOC's overall development layout,» Hu. «It is a logical business development.»
