The Bank of China, one of China’s biggest lenders, is marketing a new dollar note linked to the Secured Overnight Financing Rate (SOFR), one of the planned Libor replacements. Once priced, this bond would be the first SOFR-linked foreign-currency bond from a Chinese issuer. “Asian investors are now looking at the logistics, like the calculation of coupons, and working with the operation department on how to handle the daily fixing monitoring,” said Pheona Tsang, chief investment officer of fixed income at BEA Union Investment Management. “Since SOFR will eventually replace Libor, investors will start to get familiar with the new structure,” she said.
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