Hong Kong Urban Renewal Authority’s US$1.54 billion bond issue gets strong response

The well-received offering drew local and overseas investors including banks, asset managers, insurance companies, central banks and official institutions. It comprises bonds worth HK$4 billion with a three-year tenor, HK$5 billion with a five-year tenor and HK$3 billion with a 10-year term, the authority said on Wednesday.

It is the URA’s first issuance in the Hong Kong dollar public institutional bond market since 2009. The offering is one of the largest ever joint Hong Kong dollar bond offerings in the city, and the five- and 10-year Hong Kong dollar tranches are also the largest on record, the URA said.

The authority said the proceeds from the offering will fund capital expenditures on urban renewal projects and be used for general corporate purposes.

With coupon rates of between 3.35 per cent and 3.55 per cent, “the yields on these bonds are also the lowest in the Hong Kong dollar public offering market in the past two and a half years”, the authority said.

Underwriters of the bond issuance include Bank of China (Hong Kong), Crédit Agricole, HSBC, Standard Chartered and UBS.