Hong Kong plans new digital green bond issue, Bloomberg reports

Hong Kong plans to issue digital green bonds denominated in US dollars, Hong Kong dollars, euros and offshore yuan, which could be priced as early as Monday, Bloomberg reported, citing people familiar with the matter.

If successfully priced, it would be the city’s third such sale since 2023. The government last issued HK$6 billion worth of digital bonds in early 2024.

Singapore and Dubai have made strong strategic moves in digital assets, posing real competition to Hong Kong, Bloomberg cited Li Han, an analyst at Citic Securities, as saying.

Digital bonds can be issued via distributed ledger technology platforms or on public blockchains such as Ethereum, which may offer greater flexibility. Compared with traditional bonds, tokenised bonds can shorten settlement times, reduce costs and attract investors drawn to blockchain-based securities.

S&P Global Ratings and Fitch Ratings have reportedly given the planned bonds “AA+” and “AA–” ratings, respectively, in line with Hong Kong’s long-term foreign- and local-currency issuer ratings.