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Second issue of 5-year Exchange Fund Notes well received
The Hong Kong Monetary Authority (HKMA) said there was a good market response to the tender today (Monday) for the second issue of five-year Exchange Fund Notes, which matures in 1999.
The five-year Notes, which carried a coupon rate of 8.15 per cent, were 6.2 times over-subscribed.
The average accepted tender price was 99.36, providing an annualised yield of 8.48 per cent, or about 56 basis points above that for five-year US Treasury notes.
Such a small spread demonstrates that the market has largely discounted the risk, if any, associated with the change of sovereignty and thus not demanded any significant premium.
"We are very pleased with the tender result which was good despite concerns for possible interest rate hike in the US. The result demonstrates clearly that the five- year Notes have been extremely well received in the market," the Chief Executive of HKMA, Mr Joseph Yam, said.
"It further reinforces the purpose of establishing a reliable benchmark for other Hong Kong dollar debt issues in the five-year area."
The inaugural issue of the five-year Notes was launched in September, with an over-subscription rate of 2.12 times.
End/Monday, December 19, 1994
174th meeting of the Education Commission
The following is issued on behalf of the Education Commission:
Almost all the recommendations in the report of the Working Group on Language Proficiency are likely to be included in the Education Commission's Report No. 6 (ECR6). But some of the supporting arguments will be strengthened in the light of comments received from the public.