Bank of China Group's latest Hong Kong dollar debt issue is on the road to oversubscription, driven by a wave of positive sentiment towards Chinese paper. 'China is one of the few places in Asia where people are excited,' one banker said. The $2 billion floating rate certificate of deposit (FRCD) has a maturity of five years and is being handled by Bank of China's Hong Kong branch. Bankers said they expected a 'very strong response' despite relatively tight pricing for the paper. The FRCD is being issued at par and carries a coupon of 31 basis points above the one-month Hong Kong interbank offered rate. The all-in pricing for participants taking $200 million or more is 36 basis points. 'Our feeling is that it is pretty tight, but that it will get along anyway,' a banker at a US institution said. The pricing is only slightly more generous than the 35 basis points offered on a recent five-year deal by Standard Chartered Bank, and significantly tighter than the 38 basis points offered by Hongkong Bank's deal in spring. Bankers said the issue was timed to coincide with the handover because banks would want to be part of a 'commemorative' deal. Responses are due on July 3. As such, the deal is expected to follow in the footsteps of Bank of China's most recent FRCD, in October last year. It was so oversubscribed it was doubled to $4 billion. At the end of last week, Bank of China raised US$200 million with five-year floating rate notes issued for the Asia market.