Launch of US$3 Billion Medium Term Note Programme

Press Releases

27 Jun 2007

Launch of US$3 Billion Medium Term Note Programme

The Hong Kong Mortgage Corporation (HKMC) is pleased to announce today (27 June) the launch of US$3 Billion Medium Term Note Programme (the "Programme"). The event was marked by a signing ceremony held today.

The Programme is a flexible, efficient and cost-effective platform for the HKMC to launch debt issues. It will help the HKMC to broaden its investor base and funding sources in the international market. This will also help to set a quasi-sovereign benchmark for Hong Kong to further promote the development of the regional bond market.

The multi-currency feature of the Programme will enable the HKMC to issue notes in major currencies including the Hong Kong dollar, US dollar, euro and yen to meet the demands of both domestic and overseas investors. The Programme also incorporates flexible product features and offering mechanisms that allow public issues as well as private placements, which will increase its appeal to investors with different investment horizons and requirements. The major features of the Programme are at the Annex.

An extensive distribution network comprising the major international and regional financial institutions has been put in place to support future issuance and provide secondary market liquidity. The Programme is arranged by HSBC and JPMorgan and supported by a Dealer Group comprising Barclays Capital, BNP Paribas, Citi, Deutsche Bank, Goldman Sachs (Asia) L.L.C., HSBC, JPMorgan, Nomura International, Standard Chartered Bank and UBS Investment Bank.

"Over the past decade, the HKMC has fulfilled its mandate to promote the development of the primary and secondary mortgage markets in Hong Kong. In doing so, it has contributed to the stability of Hong Kong's banking sector and the development of the housing and debt markets," said Mr Joseph Yam, Chief Executive of the Hong Kong Monetary Authority (HKMA) and Deputy Chairman of the HKMC. "A comprehensive business review was conducted last year. The review re-affirmed, among other things, the strategic importance of the Corporation in the provision of contingent liquidity to the banking sector, especially in times of crisis, and identified a corresponding need to sustain its business. Therefore, the HKMC will continue to fulfil its primary mandate through an expansion in scope. The expansion will be in two directions. First is to broaden its scope of business domestically and second is to play a role in the development of housing finance markets in the region."

Mr Peter Pang, Deputy Chief Executive of the HKMA and Executive Director of the HKMC said, "Given the Triple-A rating for local currency by Moody's, solid financial performance and prudent risk management framework, the HKMC is well positioned to share its experience and expertise with markets in the region in the areas of mortgage purchase, mortgage insurance and securitisation. The HKMC will strive to achieve the objective of developing the debt market in Hong Kong which can further strengthen Hong Kong's role as an international financial centre and contribute to financial intermediation for the Mainland."

Mr Peter Wong, Executive Director of The Hongkong and Shanghai Banking Corporation Limited said, "HSBC is privileged to be Joint Arranger for the HKMC's Medium Term Note Programme, which represents a continuation of a trusted partnership that has seen HSBC take the leading role in the HKMC's debt issuance and securitisation transactions to date. Going forward, HSBC globally is keen to continue its trusted partnership with the HKMC in achieving our common goal of promoting the development of the regional bond market to a broader international audience."

Mr Todd Marin, Head of Investment Banking, Asia Pacific (ex-Japan) at JPMorgan said, "We're extremely honoured to be Joint Arranger for the HKMC's Medium Term Note Programme. JPMorgan is proud of offering our wholehearted support to the first - and only - Hong Kong institution rated by Moody's as Aaa (local currency). The Programme is another significant milestone for the HKMC and we believe it will go a long way to expanding and diversifying the funding base for the HKMC to support its continued growth."

Annex

The Hong Kong Mortgage Corporation Limited
27 June 2007

 

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The Hong Kong Mortgage Corporation is pleased to sign and launch US$3 Billion Medium Term Note Programme today with 10 prestigious investment banks as its programme dealers.

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Last revision date : 27 June 2007