On May 7, the People's Bank of China and the China Securities Regulatory Commission jointly issued an announcement on supporting the issuance of sci-tech innovation bonds, guiding bond market funds to invest early, small, long-term, and in hard-tech sectors. The National Association of Financial Market Institutional Investors officially launched sci-tech innovation bonds in the financial market. China's Industrial Bank (CIB) responded swiftly. By May 9, the bank had assisted 11 sci-tech companies and equity investment institutions in completing the issuance of the first batch of sci-tech innovation bonds, with a total issuance amount of RMB 8.7 billion.
CIB focused on addressing pain points such as “difficulty and high cost of financing” for sci-tech innovation enterprises and “long fundraising cycles” for equity investment institutions, precisely matching the financing needs of different entities. The bond proceeds will be invested in various fields, including information technology, integrated circuits, new energy and materials, and biomedicine, covering the first batch of projects in provinces such as Jiangsu, Zhejiang, Sichuan, Shandong, and Anhui.
Notably, to foster “patient capital,” CIB underwrote a RMB 500 million sci-tech innovation bond for Lucion Venture Capital Group, a well-known domestic investment institution, which was launched on May 8. The funds will be specifically used to establish a hard-tech equity investment fund, focusing on cutting-edge fields such as information technology, biomedicine, and new materials.
To date, CIB has accumulated a reserve of over 30 sci-tech innovation bond projects, with funds covering multiple areas including equity financing, mergers and acquisitions, research and development investments for sci-tech enterprises. An executive from CIB's Investment Banking Department stated that the bank will align with the national “14th Five-Year Plan” for sci-tech innovation, continue to expand its presence in hard-tech, green technology, and digital economy sectors, explore a comprehensive service model of “sci-tech innovation bonds + equity financing + cross-border finance,” and work with industry funds and venture capital institutions to build an integrated “investment-loan-bond” ecosystem that provides sci-tech enterprises with full-cycle, all-scenario financial support.