Hong Kong Monetary Authority Reveals Results of 5-Year Bond Reopening

The Hong Kong Monetary Authority (HKMA), representing the Hong Kong Special Administrative Region Government, has announced the results of the recent tender for the re-opening of 5-year Hong Kong Dollar (HKD) Institutional Government Bonds. Held on March 5, 2025, the tender attracted significant interest from investors, according to the Hong Kong Monetary Authority.

Strong Demand for Bonds

A total of HK$1.5 billion in bonds were offered, with a substantial HK$9.375 billion in tender applications received. This resulted in a bid-to-cover ratio of 6.25, indicating robust demand among institutional investors. The average price accepted was 99.80, which corresponds to an annualized yield of 3.301%.

Key Details of the Bond Issue

The bonds, identified by the issue number 05GB2912001, were re-opened under the Infrastructure Bond Programme. They carry a coupon rate of 3.23% and are set to mature on December 5, 2029. The issue and settlement date is noted as March 6, 2025.

The tender results also highlighted the lowest price accepted at 99.55, yielding 3.360%, with a pro-rata ratio of approximately 51%. The average tender price was recorded at 99.33, yielding 3.412%.

Implications and Market Context

This high level of interest in the HKD bonds reflects a stable investor confidence in Hong Kong's economic outlook and the government's fiscal policies. The re-opening of this bond issue is part of a broader strategy to support infrastructure development and manage public debt efficiently.

Globally, bond markets have been closely watched due to fluctuating interest rates and economic recovery prospects post-pandemic. The successful issuance by the HKMA suggests a positive sentiment towards Hong Kong's fiscal health and its strategic financial initiatives.