HK$55 billion Silver Bonds issuance raised to upper limit on record demand
Hong Kong's 11th Silver Bonds round saw record HK$119.8 billion in subscriptions, prompting the government to raise the final issue size from HK$50 billion to the maximum cap ahead of the US Federal Reserve decision.
The Hong Kong government increased its final issuance target for the 11th batch of Silver Bonds from HK$50 billion to the upper limit of HK$55 billion due to exceptionally high demand. Investors submitted 478,000 bids totaling HK$119.8 billion (US$15.28 billion) during the offering period that concluded on Friday at 2pm. This represented a 22% increase in total value and a 28% rise in the number of applicants compared to last year's record offering, which drew 371,821 applications for HK$98.23 billion. To address the strong interest from elderly investors seeking better returns than bank deposits, the government raised the guaranteed coupon rate to 4.25%, up from 3.85% last year and 4% in 2024. Consequently of this surge, officials confirmed the final allocation would reach HK$55 billion rather than the original planned amount. The Hong Kong Monetary Authority will announce the allotment results on September 11, with bond issuance scheduled for September 15. This move occurs just before the Federal Open Market Committee vote on September 17 regarding US interest rates, with roughly 60% of traders predicting a rate hike while the remaining expected stability.
