The Agricultural Development Bank of China, a major policy bank, saw its first bond issue under the mainland-Hong Kong bond connect program oversubscribed on Monday.
The bank raised a total of 16 billion yuan (2.36 billion U.S. dollars) through policy-based financial bonds, 1 billion of which were issued exclusively to overseas investors.
The subscription ratio, the amount of purchase requests to the amount of bonds available, stood at 2.52 for bonds issued only to overseas investors, indicating enthusiasm on the first day of trading.
The Chinese authorities approved the bond link in mid-May, allowing investors from both sides to trade bonds on each other's interbank markets. "Northbound" trade, which allows foreign investors to buy bonds issued on the Chinese mainland, started Monday, without caps on investment volume.
China has the world's third largest bond market, which is growing rapidly and opening more widely across the globe.