China hires 10 banks including Citigroup, HSBC for $2bn sovereign bond issue

The bond is expected to see strong investor demand despite downgrades of China’s sovereign credit rating this year. (Reuters)
Updated 20 October 2017
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China hires 10 banks including Citigroup, HSBC for $2bn sovereign bond issue

HONG KONG: China has hired 10 banks including Agricultural Bank of China Bank of Communications, and Citigroup for its $2 billion dollar-denominated sovereign bond issue, according to an internal bank memo seen by Reuters on Friday.
Besides Citigroup, other foreign banks hired by the People’s Republic of China (PBOC), acting through the Ministry of Finance, for the issue are Deutsche Bank, HSBC , and Standard Chartered, the memo showed.
Bank of China, China Construction Bank , China International Capital Corp, and Industrial and Commercial bank of China will also be working on the transaction.
Due to its scarcity, the bond is expected to see strong investor demand despite downgrades of China’s sovereign credit rating this year by S&P Global Ratings and Moody’s Investors Service. Both agencies cited increasing risks from the country’s rapid build-up of debt.
But the bond sale will test if the rating agencies’ actions would increase borrowing costs for institutions in the world’s second-largest economy.
China’s central bank chief on Thursday issued a warning about asset bubbles in the economy, which looks set to clock its first acceleration in annual growth since 2010, driven by public spending and record bank lending.
The finance ministry said earlier this month that the issue will consist of $1 billion of five-year bonds and $1 billion of 10-year bonds.
Thomson Reuters publication IFR said that the issuance, if completed, would be China’s first dollar bond offering since October 2004, and that the sovereign bond will be issued in the second half of this year.
The memo said the banks hired for the bond issuance would arrange a meeting with fixed-income investors in Hong Kong on October 25.


Saudi Arabia has lion’s share of regional philanthropy

Updated 26 April 2018
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Saudi Arabia has lion’s share of regional philanthropy

  • Kingdom is home to three quarters of region's foundations
  • Combined asets of global foundations is $1.5 trillion

Nearly three quarters of philanthropic foundations in the Middle East are concentrated in Saudi Arabia, according to a new report.

The study, conducted by researchers at Harvard Kennedy School’s Hauser Institute with funding from Swiss bank UBS, also found that resources were highly concentrated in certain areas with education the most popular area for investment globally.

That trend was best illustrated in the Kingdom, where education ranked first among the target areas of local foundations.

While the combined assets of the world’s foundations are estimated at close to $1.5 trillion, half have no paid staff and small budgets of under $1 million. In fact, 90 percent of identified foundations have assets of less than $10 million, according to the Global Philanthropy Report. 

Developed over three years with inputs from twenty research teams across nineteen countries and Hong Kong, the report highlights the magnitude of global philanthropic investment.

A rapidly growing number of philanthropists are establishing foundations and institutions to focus, practice, and amplify these investments, said the report.

In recent years, philanthropy has witnessed a major shift. Wealthy individuals, families, and corporations are looking to give more, to give more strategically, and to increase the impact of their social investments.

Organizations such as the Bill and Melinda Gates Foundation have become increasingly high profile — but at the same time, some governments, including India and China, have sought to limit the spread of cross-border philanthropy in certain sectors.

As the world is falling well short of raising the $ 5-7 trillion of annual investment needed to achieve the UN’s Sustainable Development Goals, UBS sees the report findings as a call for philanthropists to work together to scale their impact.

Understanding this need for collaboration, UBS has established a global community where philanthropists can work together to drive sustainable impact.

Established in 2015 and with over 400 members, the Global Philanthropists Community hosted by UBS is the world’s largest private network exclusively for philanthropists and social investors, facilitating collaboration and sharing of best practices.

Josef Stadler, head of ultra high net worth wealth, UBS Global Management, said: “This report takes a much-needed step toward understanding global philanthropy so that, collectively, we might shape a more strategic and collaborative future, with philanthropists leading the way toward solving the great challenges of our time.”

This week Saudi Arabia said it would provide an additional $100 million of humanitarian aid in Syria, through the King Salman Humanitarian Aid and Relief Center.

The UAE also this week said it had contributed $192 million to a housing project in Afghanistan through the Abu Dhabi Fund for Development.