The Bank of East Asia, Limited Issues CBBCs Series 53861, 53862, and 53863

Strategic Insights -

The Bank of East Asia, Limited has launched three new Callable Bullion-type Bullion Covered Bonds (CBBCs) with a total issue size of 130,000,000 CBBCs, comprising 60,000,000 CBBCs, 40,000,000 CBBCs, and 30,000,000 CBBCs respectively. The CBBCs are designed to track the stock prices of BYD Company Limited, Alibaba Group Holding Limited, and Tencent Holdings Limited, with the funding cost and strike prices varying for each series.

Key Takeaways:

  • The total issue size of the CBBCs is 130,000,000 CBBCs, with 60,000,000 CBBCs, 40,000,000 CBBCs, and 30,000,000 CBBCs for each series respectively.
  • The funding cost for the CBBCs series will fluctuate throughout the life of the CBBCs.
  • The strike prices for the CBBCs series are HK$162.00, HK$269.60, and HK$581.50 respectively.
  • The cash settlement amounts will be paid at expiry, subject to no occurrence of a Mandatory Call Event.
  • The CBBCs are designed to track the stock prices of BYD Company Limited, Alibaba Group Holding Limited, and Tencent Holdings Limited.
  • The maximum number of shares to which the CBBCs relate are 120,000 Shares, 400,000 Shares, and 300,000 Shares respectively.
  • The number of CBBCs per entitlement are 500, 100, and 100 respectively.

Statistics:

  • Total issue size: 130,000,000 CBBCs
  • Funding cost for series 53861: HK$0.204
  • Funding cost for series 53862: HK$0.1400
  • Funding cost for series 53863: HK$0.1500
  • Strike price for series 53861: HK$162.00
  • Strike price for series 53862: HK$269.60
  • Strike price for series 53863: HK$581.50
  • Number of shares for series 53861: 120,000 Shares
  • Number of shares for series 53862: 400,000 Shares
  • Number of shares for series 53863: 300,000 Shares
  • Number of CBBCs per entitlement for series 53861: 500
  • Number of CBBCs per entitlement for series 53862: 100
  • Number of CBBCs per entitlement for series 53863: 100

Sources:

  • The Bank of East Asia, Limited: https://www1.hkexnews.hk/listedco/listconews/sehk/2020/1111/2020111100811.pdf