• Successful Offering: HK$25 billion in green bonds across RMB, USD, and EUR, with HK$120 billion equivalent in orders.
• Innovative Bonds: First 20-year and 30-year RMB Green Bonds issued, extending the offshore RMB yield curve.
• Global Enthusiasm: Strong participation from global institutional investors, reinforcing Hong Kong’s status as a green finance hub.

The HKSAR Government has successfully launched an HK$25 billion green bond offering, denominated in Renminbi (RMB), US dollars (USD), and euro (EUR) under the Government Sustainable Bond Programme.

Key Details:

• Pricing: Bonds were priced on July 17, 2024, after a virtual roadshow on July 16, 2024.
  • RMB2 billion 2-year tranche at 2.60%
  • RMB2 billion 5-year tranche at 2.70%
  • RMB2 billion 10-year tranche at 2.80%
  • RMB2 billion 20-year tranche at 3.05%
  • RMB2 billion 30-year tranche at 3.15%
  • US$1 billion 3-year tranche at 4.336%
  • EUR750 million 7-year tranche at 3.379%

Investor Interest:

• The offering attracted global investors, with over HK$120 billion in orders.
• Notably, the 20-year and 30-year RMB Green Bonds are the first of their kind by the HKSAR Government, with the 30-year bond being the longest tenor RMB bond issued.

Financial Secretary’s Statement:

• Financial Secretary Paul Chan remarked, “The issuance of Government green bonds is an important initiative to promote Hong Kong’s low-carbon transformation and consolidate Hong Kong’s development as a green and sustainable finance hub. The inaugural offering of the 20-year and 30-year RMB bonds helps to extend the offshore RMB yield curve, further enrich offshore RMB product offerings, and promote RMB internationalisation in an orderly manner.“

Bond Framework and Ratings:

• Issued under the Global Medium Term Note Programme dedicated to green bonds since early 2021.
• Expected settlement on July 24, 2024, listed on the Hong Kong Stock Exchange and the London Stock Exchange.
• Assigned AA+ by S&P Global Ratings and AA- by Fitch.

Environmental Impact:

• Proceeds go to the Capital Works Reserve Fund, financing projects with environmental benefits and supporting sustainable development.
• The HKSAR Government’s Green Bond Framework, updated in February 2022, aligns with international standards and practices in the green bond market.
• Second Party Opinion by Vigeo Eiris (Moody’s ESG Solutions) and Green and Sustainable Finance Certificate from the Hong Kong Quality Assurance Agency.

Related Article: Hong Kong’s Sustainable Debt Soars to $18.2 Billion in 2023, Becomes 5th Largest Worldwide

Investor Distribution by Category:

• RMB Green Bonds: 71% banks, 13% central banks/sovereign wealth funds, 16% fund managers/private banks.
• USD Green Bonds: 57% banks, 22% central banks/sovereign wealth funds, 21% fund managers/private banks.
• EUR Green Bonds: 48% banks, 14% central banks/sovereign wealth funds, 38% fund managers/private banks.

The Hong Kong Monetary Authority represented the HKSAR Government in this green bond offering, continuing the momentum in promoting Hong Kong as a leader in green finance.