HKMA Schedules HK$1.2B Exchange Fund Notes Tender for February 20

The Hong Kong Monetary Authority will hold a HK$1.2 billion tender for 2-year Exchange Fund Notes on February 20, 2026, rolling over a maturing issue of the same tenor. The notes carry a fixed interest rate of 2.23% annually, paid semi-annually, with settlement scheduled for February 23.

Of the total offering, HK$1.195 billion has been allocated for competitive tender through Eligible Market Makers, while HK$5 million remains available for retail investors via non-competitive bids through Hong Kong Securities Clearing Company Limited. Any undersubscribed retail portion will be added to the competitive allocation.

The notes mature on February 23, 2028, and will trade on the Stock Exchange of Hong Kong starting February 24, 2026, under stock code 4108. Minimum tender amounts are set at HK$50,000 or multiples thereof for both competitive and non-competitive participants.

Yield and Pricing Context

At the stated 2.23% coupon rate, the notes price near par at approximately 100.02. The HKMA’s published price/yield table shows pricing ranging from 101.98 at a 1.23% yield down to 98.13 at 3.23%, giving bidders a reference framework for competitive submissions.

Exchange Fund Notes serve dual purposes within Hong Kong’s monetary framework. Beyond functioning as investment instruments, they form part of the Monetary Base supporting the Linked Exchange Rate System that pegs the Hong Kong dollar to the US dollar. The Exchange Fund backing these notes held HK$4,151.4 billion in total assets as of December 31, 2025.

Market Participation

Retail investors must submit non-competitive bids through Stock Exchange Participants or directly via CCASS Investor Accounts. Competitive bidders are restricted to working through HKMA-appointed Eligible Market Makers listed on the authority’s website.

Tender results will be published on the HKMA website, Refinitiv, and Bloomberg following the one-hour bidding window from 9:30 to 10:30 a.m. on February 20. The HKMA ceased issuing EFNs with tenors of three years or longer in 2015, making the 2-year notes the longest-dated regular offering in the program.

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