HKSAR Government’s record HKD20 billion digital green bond issuance is the first to integrate tokenized HKD deposits in settlement process

The bonds were issued under the HKSAR Government's HKD900bn Global Medium Term Note Programme and are listed on the Stock Exchange of Hong Kong Limited. A&O Shearman advised the HKSAR Government on the issuance. 

The four-currency, four-series transaction comprises:

• HKD5,500,000,000, 3.80% digitally native notes due 2028 (the “HKD DN Notes”)
• CNY7,500,000,000, 1.65% digitally native notes due 2031 (the “CNY DN Notes”)
• USD200,000,000, 5.00% digitally native notes due 2029 (the “USD DN Notes”)
• EUR450,000,000, 3.625% digitally native notes due 2030 (the “EUR DN Notes”). 

This offering represents the HKSAR Government's fourth consecutive annual digital bond issuance, and A&O Shearman has served as legal adviser to the issuer since the inaugural issuance in 2023. Issued under the Government Sustainable Bond Programme, the proceeds will be deployed to finance and/or refinance eligible projects under the HKSAR Government's Green Bond Framework. 

Subscription ratios across the four currency tranches ranged from 1.3 to 11.3 times, underscoring continued strong investor appetite for tokenized products issued in Hong Kong. 

A standout innovation is the use of tokenized deposits in the primary issuance settlement process of the HKD tranche, marking the world’s first digital bond to integrate tokenized deposits denominated in HKD. This feature operates alongside conventional settlement and the tokenized central bank money option introduced in the previous issuance. Together, they support a cohesive digital ecosystem and promote greater interoperability and automation in the bond lifecycle.