HK Mortgage Corporation Launches Retail Bond Issue

The HKMC also announced that it has signed an agreement with the Underwriting Bank, HSBC for an underwriting amount of HKD300mn in respect of the 2-year Hong Kong dollar notes of the Issue.

Under the Programme, the HKMC has appointed 17 banks from the Dealer Group as Placing Banks to distribute the Issue to retail investors.

They are Bank of China (Hong Kong), Bank of Communications Hong Kong Branch, Bank of East Asia, China Construction Bank (Asia), Chiyu Bank, Chong Hing Bank, CITIC Ka Wah Bank, Dah Sing Bank, DBS Bank (Hong Kong), Hang Seng Bank, HSBC, ICBC (Asia), Nanyang Commercial Bank, Shanghai Commercial Bank, Standard Chartered Bank (Hong Kong), Wing Hang Bank and Wing Lung Bank.

The Placing Banks will also perform the role of market makers for the Issue to facilitate transactions in the secondary market.

This offering mechanism through Placing Banks was first introduced by the HKMC in 2001, and has proven highly effective in marketing bonds to retail investors. So far, the HKMC has issued 10 retail bond issues totalling HKD13bn.

HKMC retail bonds provide investors with the choice of an additional investment product to achieve a balanced investment portfolio and stable interest income.

James H. Lau Jr., Chief Executive Officer of the HKMC, commented earlier this week that: "Today, we are launching a new retail bond issue under the HKMC Retail Bond Programme, which caters for investors who prefer stable interest income and also for more experienced investors who look for yield enhancement and portfolio diversification. I trust the HKMC's consistent efforts to promote the development of the retail bond market will create a win-win situation for the investors, the placing banks and the Corporation."

The offer period commenced at 9am on 4th June 2008 and will end at 2pm on 13th June 2008.