China Construction Bank approved to issue perpetual bonds

Source: Xinhua | 2019-11-05

China Construction Bank, one of the country's leading state-owned commercial banks, has been approved to issue no more than 40 billion yuan (5.66 billion U.S. dollars) of perpetual bonds.
The bank has received approvals from the China Banking and Insurance Regulatory Commission and the People's Bank of China, according to the company's report filed with the Shanghai Stock Exchange Monday.
After the issuance, the bonds will be traded and circulated in the national inter-bank bond market.
The bank proposed to issue perpetual bonds at the 2018 annual general meeting of shareholders held on June 21, 2019.
Perpetual bonds are fixed-income securities with no maturity date and are not redeemable but pay a steady stream of interests forever.
The tool is often used to replenish capital for commercial banks so that they can better serve the real economy.
In January, the Bank of China became the first domestic bank to issue perpetual bonds.