Hong Kong Digital Green Bond
Hong Kong issues the third batch of digital green bonds, with a total amount of HKD 10 billion, making it the world’s largest digital green bond.
Digital green bonds are issued under the Government Sustainable Bond Program.
Related Post: Introduction to Hong Kong Green Bond Program
Introduction to Hong Kong Digital Green Bond
The Hong Kong digital green bond is priced in RMB, HKD, USD, and EUR, aiming to promote the application of financial technology in the bond market and support the development of sustainable financial markets. The Government’s Policy Statement 2.0 on the Development of Digital Assets issued in Hong Kong regulates digital bond assets. This issuance is based on the Bond Data Taxonomy of International Capital Market Association (ICMA), promoting information exchange among market participants.
The characteristics of the digital green bonds include:
- Digital currency settlement: Digital green bonds are the world’s first bonds to include digital RMB and digital HKD in the settlement process, which can reduce settlement time, costs, and counterparty credit risks.
- Scale expansion: The scale of this bond issuance is HKD 10 billion, and the market subscription amount has reached HKD 130 billion. To meet the market’s demand for long-term digital bonds, the maximum issuance period of bonds is five years.
- Global standard: Bonds use Digital Token Identifiers defined by the International Organization for Standardization (IOSCO), which are directly related to International Securities Identification Numbers (ISIN) and Legal Identity Identifiers (LEI).
Previously issued digital green bonds in Hong Kong include:
- February 2023: Hong Kong issues its first batch of digital green bonds with a scale of HKD 800 million. This issuance is the world’s first batch of government digital green bonds.
- February 2024: Hong Kong issues the second batch of digital green bonds with a scale of HKD 6 billion. This issuance is the first batch of multi-currency government digital green bonds in the world.
Since the establishment of the Green Bond Framework in 2019, Hong Kong has issued a total of 11 batches of green bonds with a total issuance scale of HKD 240 billion, including HKD 200 billion for institutional green bonds and HKD 40 billion for retail green bonds. Hong Kong plans to continue expanding the scale of digital bonds and consolidating its position as a global center for digital assets.
Reference:
Hong Kong Third Digital Green Bonds Offering
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