Hong Kong Prices HK$20 Billion Digital Green Bonds, World's Largest Issuance

Hong Kong has priced its fourth digital multi-currency green bond offering at HK$20 billion (about $2.55 billion), the government said, describing it as the largest issuance of its kind globally.

The offering is the first digital bond issue to incorporate tokenised deposits in Hong Kong dollars, a step that underscores the city's push to strengthen its position as a global hub for green and sustainable finance.

The bonds were issued by the government of the Hong Kong Special Administrative Region of the People's Republic of China and were denominated in four currencies: Hong Kong dollars, renminbi, US dollars and euros.

Financial Secretary Paul Chan said the offering, which was oversubscribed, serves the asset diversification needs of both local and overseas investors.

The issuance was split into four tranches. The two-year Hong Kong dollar tranche of HK$5.5 billion ($701.03 million) was priced at 3.80%, while the five-year renminbi tranche of 7.5 billion yuan ($1.12 billion) was priced at 1.65%. The three-year US dollar tranche of $200 million was priced at 5.023%, and the four-year euro tranche of €450 million ($510.53 million) was priced at 3.734%.

Subscription ratios across the four currencies ranged from 1.3 to 11.3 times.

Proceeds from the issuance will be used to finance or refinance eligible environmental projects under the government's Green Bond Framework. These projects are aimed at environmental improvement, climate action and the transition to a low-carbon economy.

The bonds, which are expected to be listed on the Hong Kong Stock Exchange, carry ratings of AA-minus from Fitch, Aa3 from Moody's and AA-plus from S&P, in line with the HKSAR government's long-term rating.

HSBC, Bank of China (Hong Kong), J.P. Morgan and Standard Chartered Bank were among the institutions involved in the issuance.