Allen & Overy advises on Bocom Leasing’s issuance of sustainability bonds
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Allen & Overy has advised the joint lead managers and joint bookrunners on Bocom Leasing Management Hong Kong Company Limited’s (Bocom Leasing) USD500 million 1.125% sustainability bonds due 2024 pursuant to its Sustainable Financing Framework (the Framework). The bonds were issued under Bocom Leasing’s USD6 billion medium term note programme with the benefit of a keepwell and asset purchase deed provided by Bank of Communications Financial Leasing Co., Ltd.
The Framework is aligned with the four core components of the Green Bond Principles 2018, Social Bond Principles 2020, Green Loan Principles and Social Loan Principles 2021 and sets out the governance and processes under which Bocom Leasing intends to issue green, social or sustainability bonds or other debt instruments. This is the first issuance of sustainability bonds with the credit support provided by a Chinese financial leasing company which is linked to the Framework comprising green, social and sustainability bonds.
Under the Framework, proceeds of the issuance of any green bonds will be allocated to Eligible Green Projects, proceeds of the issuance of any social bonds will be allocated to Eligible Social Projects and proceeds of the issuance of any sustainability bonds will be allocated to Eligible Green Projects and Eligible Social Projects (all as defined in the Framework). The Framework was dually certified by Vigeo Eiris and the Hong Kong Quality Assurance Agency.
John Lee, partner in Allen & Overy’s International Capital Markets team, commented: “We are seeing more and more sustainability-themed bonds from Chinese issuers but this is the first such issuance from a Chinese financial leasing company. This transaction will set a market standard for future deals which aim to drive forward the sustainability agenda.”
The A&O team was led by partner John Lee and Of Counsel Jessica Li, with support from associate Erica Lo and trainee Hiu Wing Kwok.
This transaction demonstrates the strong expertise of Allen & Overy in the area of ESG financing. Earlier this year, Allen & Overy also advised the joint lead managers in connection with China Construction Bank Corporation’s issuance of significant multi-tranche environmental, social and governance (ESG) themed bonds worth a combined total of approximately USD2.4 billion. The landmark issuance marked a number of market-firsts in ESG finance, including the world’s first simultaneous issuance of tri-product ESG bonds (ie green, transition and sustainability-linked bonds).
The information contained herein is restricted and is not for publication, distribution or release in or into the United States of America, Australia, Canada, Japan or South Africa. This announcement is not an offer of securities for sale or a solicitation of an offer to purchase securities in the United States or any other jurisdiction. The bonds referred to herein (the "Securities") have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not, subject to certain exceptions, be offered or sold in the United States or to or for the account or benefit of a person located in the United States.