Hong Kong draws over US$4bn for Green bonds

Credit: REUTERS/Bobby Yip

The Government of the Hong Kong Special Administrative Region of the People’s Republic of China (Aa2/AA+/AA+) has attracted over US$4bn of orders for a US$1bn five-year Green bond that priced at Treasuries plus 32.5bp.

HONG KONG, May 22 (IFR) - The Government of the Hong Kong Special Administrative Region of the People’s Republic of China (Aa2/AA+/AA+) has attracted over US$4bn of orders for a US$1bn five-year Green bond that priced at Treasuries plus 32.5bp.

Asia accounted for 50% of the 144A/Reg S notes, followed by a 27% allocation into Europe and 23% into the US. By investor type, sovereign wealth funds, central banks and SSAs took 41% of the deal, fund managers, insurers and private banks bought 30%, and banks took 29%.

"The favourable response from global investors indicates not only their recognition of Hong Kong’s credit strength, but also their support of Hong Kong’s determination and efforts in promoting sustainable development and combating climate change," Financial Secretary of Hong Kong Paul Chan said in a press release.

The Green bonds began marketing at initial price guidance of Treasuries plus 50bp area.

The notes have expected ratings of AA+ from both S&P and Fitch.

Proceeds will be used to finance and/or refinance projects that will provide environmental benefits and support the sustainable development of Hong Kong.

Vigeo Eiris and Hong Kong Quality Assurance Agency are Green external reviewers.

Credit Agricole and HSBC were the Green structuring banks. The two were also joint global coordinators, joint lead managers and joint bookrunners on the transaction.

(Reporting by Frances Yoon; Editing by David Holland)

((frances.yoon@thomsonreuters.com; +852 2841 5783; Reuters Messaging: frances.yoon.thomsonreuters.com@reuters.net))

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