The Hong Kong Monetary Authority published an update that The Hong Kong Mortgage Corporation Limited (HKMC) has successfully completed its third infrastructure loan-backed securities (ILBS) issuance via the Hong Kong special purpose vehicle Bauhinia ILBS 3 Limited, with five classes of notes issued for an aggregate principal amount of US$427.9 million and listed on The Hong Kong Stock Exchange. The transaction is positioned as providing professional investors exposure to a diversified portfolio of project and infrastructure debt. Bauhinia 3 references a portfolio of 33 project and infrastructure loans across 28 projects in 12 countries and nine sub-sectors, with a total value of approximately US$450.5 million. The structure includes a US$117 million sustainability tranche (Class A1-SU) backed by sustainable, green and social assets and issued under HKMC’s Social, Green and Sustainability Financing Framework, aligned with International Capital Market Association Green Bond Principles, Social Bond Principles and Sustainability Bond Guidelines. Investor demand was described as strong, including increased participation from outside Asia, and the deal included a non-investment grade Class D note described as the first of its kind in Asia; Asian Infrastructure Investment Bank supported the issuance as an anchor investor under its US$300 million investment programme. HKMC stated that the Bauhinia ILBS programme is intended to be developed through regular issuances following earlier transactions in 2023 and 2024.

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