Hong Kong Monetary Authority: The interest rate of infrastructure retail bonds has taken into account a basket of factors. The 3.5% interest rate is attractive to citizens.

Recently, the Hong Kong government announced the issuance of infrastructure retail bonds with a target issuance amount of 20 billion Hong Kong dollars, which could be increased to 25 billion Hong Kong dollars. The guaranteed interest rate is no less than 3.5%, lower than the 4% interest rate of the bonds issued last month, and the maximum issuance amount is also lower than the 55 billion Hong Kong dollars of the last bond issuance. The Assistant Chief Executive (External) of the Hong Kong Monetary Authority, Xu Huaizhi, stated that the interest rate of this batch of bonds has considered a basket of factors, believing that the 3.5% interest rate is attractive to citizens. As for the issuance amount of each batch of bonds, it will vary according to the issuance purpose and arrangement. Zhou Guochang, General Manager of the Personal Digital Financial Products Department of BOC Hong Kong, said that he believes this bond issuance will be well received by the market, as the market expects a slow pace of interest rate cuts in the next 1 to 3 years, and purchasing bonds can lock in returns for the next 3 years. Currently, bank deposit interest rates have also fallen to about 3%, so the 3.5% interest rate of this batch of infrastructure bonds is considered attractive. Zhou Guochang pointed out that the Hong Kong government has accumulated many years of experience in issuing bonds, and the relevant bonds are familiar to the public. Many customers have subscribed to government bonds in the past, and he believes it can attract more new customers. He expects the number of subscribers to this batch of bonds to exceed the 300,000 people who subscribed to the green bonds issued at the end of last year. Zhou Guochang also expects that the online application proportion for this issuance will reach 80%.