The Hong Kong Special Administrative Region Government today announced the successful pricing of approximately HK$27 billion worth of green bonds and infrastructure bonds denominated in Hong Kong dollars (HKD), renminbi, US dollars and euro under the Government Sustainable Bond Programme and the Infrastructure Bond Programme.
The issuance of green bonds aims to attract and channel market capital to support green projects, promoting sustainable development in Hong Kong.
Meanwhile, infrastructure bonds help accelerate the development of projects such as the Northern Metropolis, and facilitate the early completion of projects for the good of the economy and people’s livelihood.
Following a virtual roadshow on June 2, the bonds were priced on June 3 as follows:
5 billion 30-year infrastructure tranche at 3.85%; RMB4 billion 20-year green tranche at 2.6%; RMB4 billion 30-year infrastructure tranche at 2.7%; USD1 billion five-year green tranche at 4.151%; and EUR1 billion eight-year green tranche at 3.155%.
The offering attracted participation from over 30 markets across Asia, Europe, the Middle East and the Americas, with the total order amounting around HK$237 billion equivalent, representing a subscription ratio of around 3.3 to 12.5 times.
The Hong Kong Monetary Authority highlighted that the HKD 30-year bond, offered for the first time by the Hong Kong SAR Government, is the longest tenor HKD bond issued by the Hong Kong SAR Government so far.
The 20-year and 30-year RMB bonds also received overwhelming support, doubling in issuance size from last year.
Financial Secretary Paul Chan said: “Global institutional investors responded enthusiastically to the subscription, fully reflecting their confidence in Hong Kong’s sound public finance and long-term development.
“The inaugural offering of the 30-year HKD government bonds helps to extend the HKD benchmark yield curve, further promoting the development of the local bond market.”
The green bonds and infrastructure bonds are expected to be settled on June 10, and listed on the Hong Kong Stock Exchange as well as the London Stock Exchange.
These bonds have been assigned credit ratings of AA+ by S&P Global Ratings and AA- by Fitch.