The government of the Hong Kong Special Administrative Region of China (HKSAR) confirmed the successful offering of USD 2.5 billion of green bonds under the Government Green Bond Program. HKMA acts as the representative of HKSAR government for the green bond offerings under the Government Green Bond Program. The offering comprises three tranches of USD 1 billion 5-year, USD 1 billion 10-year and USD 500 million 30-year green bonds, which will build a comprehensive benchmark curve for potential issuers in Hong Kong and the region. The green bonds are expected to be listed on the Hong Kong Stock Exchange and the London Stock Exchange.
The 30-year tranche is also the first 30-year green bond to be issued by an Asian government and the longest tenor to be issued by the HKSAR government. Overall, the deal attracted strong interest from a diverse group of conventional and green investors. There was overwhelming demand from Asian institutional investors, resulting in the overall allocation of 65% of the total issuance size to this group. This reflects the strong pickup in Asian investors’ appetite for green financial products and demonstrates Hong Kong’s leading role in championing green finance in the region. European and U.S. investors received an allocation of 20% and 15% of the total issuance, respectively. Worth noting is the strong preference of European and U.S. investors for longer-tenor green bonds, with a combined allocation of half of the 30-year tranche. By investor type, 34% of the green bonds were distributed to banks; 46% to fund managers, private banks, and insurance companies; and 20% to central banks, sovereign wealth funds, and supranationals.
The HKSAR government had published the green bond framework in 2019, which sets out how green bond proceeds will be used to fund projects that will improve the environment and facilitate the transition to a low-carbon economy. The green bonds have also received the Green Finance Certificate (Pre-issuance Stage) from the Hong Kong Quality Assurance Agency. Credit Agricole CIB and HSBC acted as Joint Global Coordinators, Joint Lead Managers, Joint Bookrunners, and Joint Green Structuring Banks for the Green Bonds offering while BNP PARIBAS, Citigroup, ICBC (Asia), J.P. Morgan, and Standard Chartered Bank acted as Joint Bookrunners and Joint Lead Managers.
Keywords: Asia Pacific, Hong Kong, Banking, Green Bonds, ESG, Sustainable Finance, HKMA
APRA announced the standardization of quarterly reporting due dates for authorized deposit-taking institutions.
Bundesbank published a list of "EntryPoints" that are accepted in its reporting system; the list provides taxonomy version and name of the module against each EntryPoint.
The private sector working group of ECB on euro risk-free rates published the recommendations to address events that would trigger fallbacks in the Euro Interbank Offered Rate (EURIBOR)-related contracts, along with the €STR-based EURIBOR fallback rates (rates that could be used if a fallback is triggered).
EBA published the phase 1 of its reporting framework 3.1, with the technical package covering the new reporting requirements for investment firms (under the implementing technical standards on investment firms reporting).
Asia Pacific Australia Banking APS 111 Capital Adequacy Regulatory Capital Basel RBNZ APRA
ESMA published the final guidelines on outsourcing to cloud service providers.
EBA published annual data for two key concepts and indicators in the Deposit Guarantee Schemes (DGS) Directive—available financial means and covered deposits.
OSFI has set out the schedule for release of draft guidance on the management of technology risks by federally regulated financial institutions and private pension plans.
MAS updated rules for new housing loans by banks and finance companies.
HKMA published a statement on the 100% Personal Loan Guarantee Scheme and a guideline on the Green and Sustainable Finance Grant Scheme (GSF Grant Scheme) as announced in the 2021-22 Budget.