XN000022-1995-05-15 — Page 5

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Terms and conditions of the issue are described fully in the Information Memorandum.

The HK$500 million MTRC Notes issue is the first tranche of the MTRC Note Issuance Programme in which the HKMA acts as the arranger, custodian, agent and operator.

The MTRC Notes, which are denominated in HK$50,000, will be cleared through the Central MoneyMarkets Unit (CMU) and will qualify as eligible securities for repo under the Liquidity Adjustment Facility operated by the HKMA.

The MTRC Notes will be covered by the existing market-making arrangements for the Exchange Fund Bills and Notes, marking the first time a non-Government debt issuance programme has joined the arrangement.

So far, 28 Market Makers and 62 Recognised Dealers (see Annex A) have responded to HKMA's invitation to participate.

"The response is very encouraging," the Chief Executive of the HKMA, Mr Joseph Yam, said.

"The market making arrangement is expected to help increase the liquidity of the Notes and thus enable MTRC to achieve cost effective Hong Kong dollar funding."

The Treasurer of the MTRC, Mr Jimmy Lau, also said: "We expect the MTRC Notes Programme will be well received by the market in view of the significant number of Market Makers and Recognised Dealers who have accepted appointment to the Programme."

Under the revised market-making arrangement, effective today, Market Makers of both Exchange Fund and MTRC papers can go short in any issues of such papers provided they hold sufficient amount of other Exchange Fund or MTRC papers in the system to cover their short positions by entering into a repo transaction with the HKMA at the end of the day. In return the market makers are obliged to quote two- way (bid-ask) prices during normal money market hours.

MTRC will use the proceeds for general working capital, refinancing and other corporate requirements.

Members of the public who wish to tender for the Notes may do so through any of the Market Makers or Recognised Dealers on the published list which can be obtained from the HKMA at 30th floor, 3 Garden Road, Hong Kong (or telephone 2878 8150).

Each tender must be for an amount of HK$50,000 or integral multiples thereof.