Hong Kong Monetary Authority to Conduct Tender for 2-Year Exchange Fund Notes in February 2025

The Hong Kong Monetary Authority (HKMA) has announced that a tender for 2-year Exchange Fund Notes will take place on February 21, 2025. The settlement date is set for February 24, 2025, as part of a rollover plan for notes maturing on the same day, according to the HKMA.

Details of the Tender

A total of HK$1,200 million worth of 2-year notes will be available. Of this, HK$5 million is reserved for non-competitive tender bids through the Hong Kong Securities Clearing Company Limited (HKSCC). Any undersubscribed amount from this section will be added to the competitive tender portion, initially set at HK$1,195 million. The notes, maturing on February 24, 2027, will carry an annual interest rate of 3.34%, payable semi-annually.

Application Process

Retail investors interested in non-competitive tenders can submit applications via Stock Exchange Participants/Brokers or directly through HKSCC if they hold Investor Accounts at the Central Clearing and Settlement System (CCASS). Competitive tender applications should be submitted through Eligible Market Makers listed on the HKMA website. Each tender must be for HK$50,000 or its multiples.

Publication of Results

The results of the tender will be available on the HKMA’s website, as well as on the Refinitiv screen (HKMAOOE) and Bloomberg. Non-competitive bidders can also access the results via Stock Exchange Participants/Brokers or directly through the CCASS terminal.

Significance of the Tender

This tender is a part of HKMA’s regular issuance of Exchange Fund Notes, which are pivotal for managing monetary stability and providing a risk-free benchmark for the local bond market. The issuance aligns with HKMA’s ongoing strategy to ensure liquidity and stability in Hong Kong’s financial markets.

For further details, investors and interested parties are encouraged to contact Eligible Market Makers or consult the Information Memorandum published by the HKMA.

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