Subscription For IBonds To Start From October 23

Officials of the Hong Kong Monetary Authority insisted the latest round of inflation-linked iBonds – the first issued by the government in four years – is a "stable and safe" option for investors amid global economic uncertainty and a low interest rate environment.

The Monetary Authority announced on Monday that the new iBonds would offer a minimum guaranteed return of 2 percent, up from the previous 1 percent.

Subscription will last from October 23 to November 5, and the iBonds will debut on the local stock market on November 17.

"The increased political risks, geo-political risks, and lingering of the pandemic situation could lead to market volatility and increase the risk of investment," said Edmond Lau, the authority’s senior executive director.

"The re-issuance of iBond this year is therefore timely, which could provide the public a stable and safe investment option under the existing low interest rate and uncertain market environment."

The government plans to issue up to HK$10 billion in iBonds, but that could go up to HK$15 billion if demand is strong.

"About the increased possibility in our allocation to a maximum HK$15 billion this year, I think the intention and the purpose really is to enable greater participation of its citizens in this iBond issuance. It does not represent any of our prediction whether it would go up to that amount," Lau said.

Holders of the three-year bonds receive interest every six months at a rate linked to local inflation, with a minimum of 2 percent.