Zach Anderson
Aug 14, 2024 13:53
The HKMA has announced the tender results for the 1-year HONIA-indexed Floating Rate Notes, with a bid-to-cover ratio of 4.56 and highest spread accepted at 0.22%.
The Hong Kong Monetary Authority (HKMA), representing the Hong Kong Special Administrative Region Government (HKSAR Government), has disclosed the results of the tender for 1-year HONIA-indexed Floating Rate Notes, according to the official source.
Tender Results Overview
The tender, part of the Institutional Bond Issuance Programme, saw a total allocation of HK$1.5 billion in 1-year HONIA-indexed Floating Rate Notes (issue number 01GH2508). The HKMA reported receiving HK$6.840 billion in tender applications, resulting in a bid-to-cover ratio of 4.56. The highest spread accepted was 0.22%.
Details of the Issuance
| Tender Date | : | 14 August 2024 |
|---|---|---|
| Issue Number | : | 01GH2508 |
| Stock Code | : | 4282 (HKGB FRN 2508) |
| Issue and Settlement Date | : | 15 August 2024 |
| Tenor | : | 1-year |
| Maturity Date | : | 15 August 2025 |
| Amount Applied | : | HK$6.840 billion |
| Amount Allotted | : | HK$1.5 billion |
| Bid-to-Cover Ratio* | : | 4.56 |
| Highest Spread Accepted | : | 0.22% |
| Average Spread Accepted | : | 0.17% |
| Pro-rata Ratio | : | About 8% |
| Average Tender Spread | : | 0.32% |
* Calculated as the amount of notes applied for over the amount of notes issued.
Market Implications
The successful tender of the 1-year HONIA-indexed Floating Rate Notes indicates strong demand for Hong Kong government bonds. With a bid-to-cover ratio of 4.56, the market’s appetite for secure, government-backed financial instruments remains robust.
This issuance aligns with the HKMA’s ongoing efforts to maintain a stable financial environment and provide diverse investment opportunities. The accepted average spread of 0.17% highlights investor confidence in the stability and creditworthiness of the HKSAR Government.
The HKMA continues to play a crucial role in managing Hong Kong’s monetary policy and financial stability, and the results of this tender further underscore the institution’s effectiveness in these areas.
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