Hong Kong Mortgage Corporation has achieved a significant milestone in digital finance by completing the world's largest digital bond issuance worth HK$12 billion (approximately $1.5 billion). According to reports from HKMC, the transaction was priced on June 10 following investor roadshows and pre-marketing activities, with bookbuilding and pricing finalized in Hong Kong. The issuance comprises three tranches: a HK$6 billion two-year bond, a HK$2.5 billion five-year bond, and a RMB3 billion three-year bond. The five-year Hong Kong dollar bond establishes a new benchmark as the longest-tenor HKD-denominated digital bond so far, marking a significant advancement in tokenized fixed-income products.
The digital bond offering generated unprecedented investor interest, with investor demand reaching approximately HK$24 billion equivalent at its peak. As reported by HKMC, orders came from more than 100 institutional accounts across Hong Kong, mainland China, and overseas markets. Participants included local investors, Southbound Bond Connect investors, and international institutions such as central banks, multilateral development banks, insurers, private banks, commercial banks, and asset managers. The transaction makes HKMC the first public-sector issuer in Hong Kong to tap the digital bond market with tokenized notes, demonstrating growing institutional acceptance of tokenized debt instruments.
The bonds were issued natively on a blockchain platform operated by Hong Kong's Central Moneymarkets Unit, which handled settlement and custody functions. According to HKMC, the issuance reduced the settlement cycle from five business days to three through the CMU's distributed-ledger platform. Investors accessed the bonds through existing Central Moneymarkets Unit infrastructure and linked accounts with Euroclear and Clearstream. The structure is designed to boost operational efficiency and has shortened settlement from five to three business days, establishing a new operational standard for digital bond issuance.
Lee Wai Man, deputy chief executive of the Hong Kong Monetary Authority and executive director of HKMC, stated that the transaction demonstrates support for the Hong Kong government's strategy of strengthening the city's role as an international fixed-income and financial center. As reported by HKMC, the issuance could encourage more issuers, investors, intermediaries, and market participants to adopt tokenized fixed-income products. The transaction follows recent developments including the Hong Kong Monetary Authority's formation of a tokenized bond expert group that includes major institutions such as JPMorgan Securities, HSBC, Standard Chartered, UBS, Ant Digital, and HashKey Group. HKMC chief executive Colin Pou added that robust pre-marketing and roadshows helped bring in arranging banks and first-time digital bond investors, underlining Hong Kong's position bridging traditional finance and digital assets.
The HKMC transaction comes one day after South Korea's KB Kookmin Bank announced a $100 million blockchain-based digital bond sale in Hong Kong, highlighting growing institutional use of tokenized debt instruments across Asia. According to HKMA, government-backed issuance has played a key role in Hong Kong's tokenization efforts, with authorities issuing HK$800 million of tokenized green bonds in 2023 and a HK$6 billion multi-currency digital green bond sale in 2024 that officials previously described as the largest digital bond issuance at the time. The transaction was supported by sixteen local and international financial institutions acting as joint global coordinators, bookrunners and lead managers, demonstrating strong institutional backing for digital bond innovation.
