December 14, 2004-China Construction Bank Corporation (CCB) announced that the third-round CCB bonds will be issued on December 21 and 22, 2004. So far, CCB has successfully issued two rounds of bonds last July and September. The three rounds of bonds are all subordinated bonds of the commercial bank, which is used to increase CCB’s supplementary capital and capital adequacy ratio.

CCB will issue about RMB 10 billion in the third-round bonds, including fixed-rate and floating-rate bonds, and the proportion and amount will be settled in the light of the purchasing.  

Among this, the par interest rate of fixed-rate bonds will be 4.95% in the first 5 years. And at the end of the second year, investors can convert it to a floating-rate bonds, which par interest rate will be the interest rate of one-year RMB term deposit plus 1.8 percentage points. And at the end of the fifth year, the issuer can redeem its bonds, otherwise, the par interest rate of fixed-rate bonds will increase to 7.95% in the second 5 years and the interest rate margin of the floating-rate bonds converted will rise to 2.8 percentage points.

The par interest rate of floating-rate bonds will be the benchmark interest rate plus 2 percentage points. The benchmark is B_1M published by China Foreign Exchange Trading System (National Interbank Funding Center). The issuer can redeem its bonds at the end of the fifth year, otherwise, the interest rate margin of the floating-rate bonds will increase to 3 percentage points. 

The third-round CCB bonds will be issued publicly in the national interbank market.