China will seek to raise over $3 billion in its overseas issuance of sovereign dollar bonds on November 26, an official at China's finance ministry said.
"The size of issuance will surpass that of previous years," the official told Reuters.
The ministry will release more information on the sovereign bond issuance, which will help improve China's offshore bond yield curve, the official said.
It will "provide a pricing benchmark for Chinese enterprises issuing U.S. dollar bonds," Bank of China said in a statement on its website on Tuesday.
The Chinese lender is one of 13 investment banks mandated to lead the U.S. dollar sovereign bond deal, according to a term sheet seen by Reuters, its third since its international debt issuance programme was revived two years ago.
Final pricing for the three-, five-, 10- and 20-year tranches will be 35, 40, 50 and 70 basis points above U.S. Treasuries of the same tenors, on order books over $20 billion, according to Refinitiv capital markets news service IFR.
The deal comes after a market rally this year that has driven global bond yields sharply lower, significantly decreasing the cost of financing compared with its previous dollar issuance in October 2018.
U.S. 10-year Treasuries yielded 1.75% on Tuesday, according to Refinitiv data, nearly 150 basis points below its highs last October when the sovereign issuer last tapped the dollar bond market.
"From a tactical financing standpoint, now is an opportune time to obtain some relatively inexpensive financing," said Alex Kozhemiakin, head of emerging markets debt at Macquarie Asset Management in New York.
In 2017, China launched its first U.S. dollar bond in 13 years. That deal raised $2 billion while a separate transaction in 2018 raised another $3 billion.
China sold its first euro-denominated bond 15 years earlier in November, raising $4.4 billion and analysts believe the European markets will become a greater source of funds for the mainland in the future.