HK Welcomes New Dim Sum Bonds Issuance

2020

By Anas Almasri

China's Ministry of Finance announced plans on June 9th to issue a new round of Yuan-denominated sovereign bonds in Hong Kong, also known as Dim Sum bonds, worth RMB 23 billion this year.

According to the official announcement, RMB 13 billion will be issued on June 26 while RMB 10 billion is to be issued during the second half of the year with the exact date not yet revealed.
Of the first RMB 13 billion bonds to be issued in June, RMB 10 billion is to be split over different maturities and sold exclusively to institutional investors using a tendering method on the Central Money Markets Unit (CMU) of the Hong Kong Monetary Authority. RMB 5 billion of which will have a maturity of three years, RMB 2 billion will be issued with a five years maturity, RMB 1 billion in seven-year bonds, RMB 1 billion in ten-year bonds, and RMB 500 million in 15-year bonds.

The remaining RMB 3 billion of the first issuance will be sold to overseas Central Banks and monetary authorities.

The second issuance round of RMB 10 billion scheduled for the second half of 2013 will be divided between RMB 7 billion to be offered to institutional investors and RMB 3 billion to retail investors.

HK Financial Secretary, John C Tsang, welcomed on behalf of HK government China sovereign bonds issuance plans that will boost the city economy and also keep the internationalization of the Yuan on track.

he HKSAR Government welcomes the issuance of RMB sovereign bonds by the Ministry of Finance in Hong Kong for the fifth consecutive year. RMB sovereign bonds will be issued twice this year, more frequently than before, in a move to regularize the issuance program. This demonstrates clearly the Central Government determination to make the issuance of RMB sovereign bonds to be a long-term institutional arrangement in Hong Kong Tsang said.

The latest Dim Sum bonds to be issued will also mark the first time 30-year RMB sovereign bonds will be provided to institutional investors. t will increase the supply of long-term RMB denominated fixed income products for institutional investors, including pension funds. This would be conducive to the Government objective to develop Hong Kong bond market added Tsang.