Strong demand for HKMA's 1-year HONIA-indexed Floating Rate Notes

The tender for HK$1.5 billion of 1-year HONIA-indexed Floating Rate Notes, issued under the HKSAR Government's Infrastructure Bond Programme, attracted significant investor interest.

A total of HK$5.190 billion in applications were received, leading to a robust bid-to-cover ratio of 3.46. This strong demand underscores the market's confidence in the Hong Kong Special Administrative Region Government's creditworthiness and the appeal of floating rate instruments.

HONIA-indexed notes, linked to the Hong Kong Overnight Index Average, offer investors a flexible return profile that adjusts with prevailing market interest rates, making them attractive in dynamic economic environments.

The successful tender provides efficient funding for public infrastructure projects, aligning with the government's long-term development objectives.

The high subscription level also highlights ample liquidity within the local financial system, demonstrating a healthy appetite for high-quality government debt.

The tender results revealed competitive pricing for the 1-year notes.

The highest spread accepted was 0.25% over HONIA, while the average spread accepted settled at 0.19%.

These figures indicate a tight pricing environment, reflecting strong competition among bidders and favorable borrowing conditions for the HKSAR Government.

The pro-rata ratio, which determines the allocation for successful bidders, was approximately 88%.

The notes, identified by issue number 01GH2702001 and stock code 4200 (HKGB FRN 2702), were tendered on February 4, 2026. They are scheduled for issue and settlement on February 5, 2026, with a maturity date exactly one year later, on February 5, 2027.