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Ng Kang-chung

Hong Kong’s finance chief has hailed a coming government issue of HK$50 billion worth of bonds to fund infrastructure projects as a “win-win investment” while throwing his support behind similar moves by public bodies to raise money.
In a weekly blog post on Sunday, Financial Secretary Paul Chan Mo-po also said the planned issue of Silver Bonds – for investors aged 60 and above – would offer attractive returns, including an annual interest rate of at least 4 per cent.
Chan noted the three-year bonds would offer elderly residents a safe and reliable place to park their money.
“The bonds provide senior citizens with a low-risk, safe investment choice with reliable returns,” Chan said.
“They not only receive stable interest returns, but can also contribute to the development of their own community and the city. It is a win-win investment.”
He said a cycle of US interest rate cuts could possibly start later this week after a meeting of the central bank, the Federal Reserve. Some analysts expect the Fed to deliver a rate cut of 0.25 percentage points although others believe a 0.5 percentage point reduction is possible.
Chan announced in his budget in February that the government would issue HK$120 billion worth of bonds in 2024-25. That includes a HK$70 billion retail tranche comprising HK$50 billion worth of Silver Bonds and HK$20 billion in green bonds and infrastructure bonds.
In his blog post, Chan said: “Apart from achieving financial inclusiveness, it is also hoped that [the bond issuances] can enhance a ‘sense of participation’ and ‘a sense of gain’ in infrastructure and sustainable development among the public.”
He added: “With the support of the government, more public bodies are raising funds through bond issuance or other methods to make better use of market funds to take forward their respective work. So far this year, there have been the Airport Authority, Urban Renewal Authority and the Housing Society.”
The Airport Authority issued HK$5 billion worth of HKIA Retail Bonds in February.

Last month the Urban Renewal Authority issued HK$12 billion in bonds in a triple tranche, while the Housing Society last week secured a HK$12 billion loan facility with 12 local and international banks for developing subsidised housing.
“Relying on the professional knowledge and experience of the market, this kind of financing method of leveraging market resources is also a means to examine the financial feasibility and rationality of the projects,” Chan added.
Chan said it was hoped that by “activating the financial services chain”, more funds and capital could be attracted to support other sectors, including technology innovation.
He said the investment sector was positive towards Hong Kong’s development prospects, because of its unique advantages and its flourishing innovation and technology ecosystem.
Technology start-ups also hoped to use the city as a springboard to the mainland Chinese and international markets, Chan added.
Last week, the government announced the launch of a new series of Silver Bonds for subscription, targeting a total issuance of HK$50 billion. Subject to market demand, the government may increase the issuance size to HK$55 billion.
The bonds are part of the Infrastructure Bond Programme. Proceeds go to the Capital Works Reserve Fund for infrastructure projects.


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Silver Bonds are an investment option for Hong Kong residents aged 60 and above. Photo: Eugene Lee

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Hong Kong

Financial Secretary Paul Chan says bonds will offer elderly residents a safe and reliable place to park their money


Financial Secretary Paul Chan says bonds will offer elderly residents a safe and reliable place to park their money.
