Hong Kong Extends Retail Green Bonds for Its Residents to Partake in Green Finance Development
With climate change being one of the vital critical drivers for development today, many city development projects are undergoing green revival or green development phases. Green financial products finance these green development projects. One of the latest green financial products available in Hong Kong is retail green bonds for Hong Kong residents.
Recently, the Government announced the release of a new batch of $10,000 retail green bonds for subscription from Hong Kong residents under the Government Green Bond Program.
Bondholders will receive interest payments every six months for the three-year term, with a minimum interest rate of 4.75% and a rate related to the city’s inflation.
New retail green bonds issued by the Government will help the market develop even more and support financial inclusion by giving the general public investment alternatives with stable returns so they can take part in and profit from the growth of green finance, commented the Financial Secretary. Paul Chan.
The earnings from government green bonds will be added to the Capital Works Reserve Fund. It will help to fund or refinance environmentally friendly projects.
Among the eligible green projects in Hong Kong that will benefit from such financing are the construction of the green building project, the Government Chinese Medicines Testing Institute in Tseung Kwan O, the drainage upgrading works in Tsim Sha Tsui as part of the climate change adaptation and North East New Territories sewerage system upgrade.
Target Offering to Go to a Maximum of $20 Billion
The retail green bond’s target offering size is $15 billion. Depending on the state of the market, the Government may decide to raise the issue size even further to a maximum of $20 billion.
With this launch, the Government intends to strengthen Hong Kong’s green and sustainable finance ecosystem by continuing to issue green bonds and demonstrating to potential issuers that Hong Kong can provide one-stop services. It is the primary platform for publishing green and sustainable financial products.
Hong Kong residents can begin to subscribe from 9 a.m. on September 18 until 2 p.m. on September 28. Residents of Hong Kong can apply through a placement bank, a securities broker, or the Hong Kong Securities Clearing Company.
On October 10, the Government will issue these bonds and the following day, they will be listed on the Hong Kong Stock Exchange. After that, they are tradeable on the secondary market.
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