On March 22, the first batch of municipal bonds of Shenzhen in 2022 were successfully issued via the SZSE municipal bond issuance system of the Ministry of Finance. It is a pragmatic measure of SZSE to give play to the platform functions and roles of the capital market to provide market services without interruption and fully support pandemic control and the development of the real economy on the basis of ensuring implementation of COVID-19 control requirements.
To support the onsite bidding and issuance of the municipal bonds, SZSE maintained close communication with Shenzhen Finance Bureau and underwriters to ensure the pandemic control requirements were strictly implemented in every procedure of the bidding and issuance process. With the help of technology, safety amid the pandemic was guaranteed, the whole procedures ran smoothly and orderly, and the issuance was completed successfully.
The first batch of municipal bonds of Shenzhen in 2022 comprised of 15 bonds, with the total issuing volume of CNY 24.6 billion and a term ranging from three to 20 years. The bid-to-cover ratio was 8.89, and the interest rate was 10 bps higher than the benchmark interest rate of the central government bonds. The interest margin narrowed compared to that in the previous year, and financing cost decreased. The proceeds from the issuance of the bonds will be used in municipal-level projects and district-level projects of 11 districts of Shenzhen in the fields of social programs, transportation infrastructure, municipal and industrial park infrastructure, government-subsidized housing, and ecological and environmental protection. Specifically, they will be used to purchase medical equipment for The Third People’s Hospital of Shenzhen (a designated hospital to treat Covid-19 patients) and National Clinical Research Center for Infectious Diseases and build such projects as the Intercity Railway of Shenzhen Metropolitan Area, the Shenzhen Park of the Shenzhen-Hong Kong Innovation and Technology Cooperation Zone, Guangming Science Town, Baoan Area of Qianhai Cooperation Zone, Pingshan New Energy Vehicle Industrial Park, government-subsidized rental housing in Longhua District, water environment treatment of Dapeng New Area, etc. The successful issuance of the first batch of bonds will play a positive role in promoting the construction of key projects and the development of pillar industries in Shenzhen and better supporting Shenzhen in implementing the measures for maintaining stable growth and benefiting the people.
Next, we will continue to firmly implement the general principles of the executive meeting of the State Council and the special meeting of the Financial Stability and Development Committee of the State Council. We will continue to optimize the bidding and issuance procedures of municipal bonds while ensuring full implementation of pandemic control measures. We will also improve the level of services, strengthen safety guarantee, support effective investment brought by issuance of municipal bonds, and effectively serve the high-quality development of the local economy.
