The remarks came as the SAR government announced the launch of the 10th batch of the three-year bond programme, for residents born in or before 1966.
Each lot will be offered at HK$10,000, with investors allocated 100 units at most, or HK$1 million. Dividends will be paid every six months.
At a press briefing, Hui said applications for the inflation-linked bonds will be accepted between September 15 and 29.
He said although the minimum interest rate is lower than the 4 percent offered last year, it is still attractive given the current market dynamics and various factors such as inflation expectations.
“If you look at how our residents might try to compare this product with others that are available, right now, for example, people generally can get around like 2 percent interest rate if they tried to get a 12-month time deposit in Hong Kong dollars from our banks,” he told reporters.
“So as far as that comparison is concerned, you can see that our offer of 3.85 [percent] is actually very attractive, and in that regard, we are confident that the overall level of subscription will be satisfactory,” he said.
Echoing Hui, Wong Tsz-cheuk, head of capital markets and securities services at HSBC Hong Kong, which is one of the lenders issuing the bonds, said the bank predicts that the US Federal Reserve will reduce interest rates three times by March next year, by a total of 75 basis points.
“From a global macro perspective, I think the global growth rates are definitely projected to be slower compared to last year when we issued the previous batch of silver bonds,” he added.
Separately, Zhou Guochang, who heads the department of personal digital financial products at Bank of China (Hong Kong), another bond issuance lender, said the bonds will attract those who have invested in such products before, while new government initiatives could also boost their attractiveness.
“With the support of government, the silver economy has been widely communicated, and we believe that the silver segment customers will be more attracted to these stable, guaranteed returns,” he said.
The government’s target issuance size is HK$50 billion, though this could be increased to HK$55 billion, subject to the market response.
