HK Government's Bond Issuance to Start in Fall

The first batch of Hong Kong government bonds will be issued in the third quarter this year upon lawmaker's approval, an official said on Monday.

Acting secretary for Hong Kong Financial Services and the Treasury Julia Leung said the government will move the two resolutions related to its bond program in the Legislative Council on May 20.

Leung said the program will comprise bond issues for institutional and retail investors and the bonds to be issued will mainly be denominated in Hong Kong dollars.

Bonds of tenors within the range of two to 10 years will likely be issued at the initial stage. Over the long term, consideration will be given to issuing bonds with longer tenors. Arrangements will be made to seek listing status for the bonds.

Views from major market participants indicate the market may be able to digest government bonds of 10 billion to 20 billion HK dollars over the course of a year.

The Government also proposed the borrowing ceiling, which refers to the maximum amount of outstanding principal at any time under the program, be set at 100 billion HK dollars. The proposed ceiling represents a long-term target over a period of five to 10 years. 

Source: CRIEnglish