Sharjah’s government has successfully raised Rmb 2 billion by issuing a three-year panda bond in China’s onshore renminbi market. The issuance marks the emirate’s return to the panda bond space after its inaugural foray seven years ago.
The pricing range for the bond was initially indicated in the 2.5 % to 3.2 % area. The transaction was arranged through a syndicate led by Bank of China, with joint underwriting and bookrunning by Crédit Agricole, JP Morgan Chase, Industrial and Commercial Bank of China, China Bohai Bank, Citic Securities, the Export-Import Bank of China and Shenwan Hongyuan.
According to published reports, Sharjah has mandated this group of banks to structure the deal under China’s bond issuance rules for overseas issuers, which include registration with relevant local oversight bodies and adherence to disclosure protocols. Market commentary suggests the pricing guidance mirrors efforts by the issuer to strike a balance between attracting domestic Chinese demand and reflecting its credit standing in global markets.
Within credit ratings, Sharjah’s profile presents a mixed picture. It carries a Ba1 rating from Moody’s and BBB– from Standard & Poor’s, offset by a AAA rating from Lianhe. While the AAA remark enhances confidence domestically in China, the non-investment grade status from international agencies could influence global investor appetite.
Sharjah first entered the China bond market in February 2018, when it issued a Rmb 2 billion panda bond—the first panda deal by a Middle Eastern issuer—with a coupon of 5.8 % and maturity in 2021. That precedent transaction won acclaim in regional debt finance circles and helped diversify Sharjah’s funding reach.
Analysts view this re-entry as signalling growing interest among Gulf region sovereigns and sub-sovereigns to tap Chinese onshore capital pools, amid shifting global capital flows. China’s interbank bond market has deepened in recent years, and rising comfort with regulatory frameworks has made it more accessible to non-Chinese issuers.
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