Dacheng Advises Wuhan Rural Commercial Bank on Issuing 2012 Subordinated Bonds

On August 30, 2012, Wuhan Rural Commercial Bank Co., Ltd., advised by Dacheng attorneys based in Wuhan, completed the issuance of subordinated bonds for 2012.
 
Commercial banks’ offering of subordinated bonds are issued on the interbank bond market upon approval from China Banking Regulatory Commission (“CBRC”) and People’s Bank of China (“PBOC”). The repayment of the principal and interest of subordinated bonds has a lower priority than other bonds in case of liquidation, just before stock. Subordinated bonds are primarily used to replenish commercial banks’ supplementary capital and uplift capital adequacy ratio so as to improve the banks’ operational strength and risk resistance capability and support continued business growth.
 
The bonds issued by Wuhan Rural Commercial Bank sized RMB1.2bn are 10-year fixed interest rate bonds callable by the issuer at the end of the 5th year under specific conditions. Credit Suisse Founder Securities acted as lead underwriter for the bonds, China Audit Asia Pacific Certified Public Accountant Co., Ltd. as auditor and China Lianhe Credit Rating Co., Ltd. as credit rating agency. Dacheng’s Wuhan-based attorneys provided all-round legal counsel for the issuance and issued legal opinion letters. The project was handled by senior partner Zhou Qunce and attorneys Guo Huilin and Chen Hongming.