UPDATE 1-China to issue US dollar bonds in four tranches of up to 30 years – term sheet

(Adds pricing details, context)

Oct 19 (Reuters) – China will issue dollar-denominated, multi-tranche bonds in tenors of three, five, 10 and 30 years, according to a term sheet seen by Reuters on Tuesday.

The Ministry of Finance mandated 14 banks on Monday for the issuance, which, according to two sources with direct knowledge of the matter, is expected to raise about $4 billion.

Initial price guidance for the offering is 35 basis points over Treasuries for the three-year tranche, 45 basis points on the five-year tranche, 55 basis points on the 10-year tranche and 85 basis points on the 30-year tranche, the term sheet showed.

Such bonds are typically in high demand from global investors due to their scarcity and high yields.

China last raised $6 billion in a U.S. dollar denominated bonds in October 2020, which was the first time U.S. based investors could participate in the deal.

Moody’s said on Monday it has rated the proposed issuance as A1, its highest ranking, with a stable outlook.

The bond offering comes as world’s second-largest economy hit its slowest pace of growth in a year in the third quarter, hurt by power shortages and wobbles in the property sector.

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