HKMC issues fourth batch of infrastructure loan mortgage securities
Hong Kong Mortgage Corporation launched Bauhinia 4, its fourth infrastructure loan securitisation, worth about US$481.5 million across 15 countries. The issuance attracted strong demand from diversified investors, with the Asian Infrastructure Investment Bank continuing as anchor investor under a US
Hong Kong Mortgage Corporation Limited (HKMC) announced on 30 October the successful issuance of its fourth batch of infrastructure loan mortgage securities, named Bauhinia 4. The offering follows three previous Bauhinia series issues between 2023 and 2025, as HKMC continues to develop this asset class through regular issuances. The securities provide professional investors with opportunities to invest in diversified infrastructure debt across different geographies and industries.
HKMC Executive Director and President Bao Keyun said the issuance demonstrates the corporation's commitment to infrastructure financing and its support for Hong Kong's development as an infrastructure financing hub. He noted that strong demand from both new and existing investors reflects growing market recognition of infrastructure as an asset class.
The Bauhinia 4 portfolio comprises 42 infrastructure debt exposures across 32 individual projects in 15 countries and 11 sub-sectors, with a total value of about US$481.5 million. The three-year non-call period for Bauhinia 1 has ended, and some assets from Bauhinia 1's redemption were included in the Bauhinia 4 portfolio.
The notes issued total US$457.3 million across five tranches (A1-SU, A1, B, C and D) and are listed on the Hong Kong Stock Exchange. HKMC issued unrated D notes in response to growing investor interest in mezzanine tranches, maintaining efficient capital structure. HKMC served as originator, collateral manager and risk retention holder for the transaction.
Sustainability remains a key theme, with US$128.5 million comprising sustainable financing notes (A1-SU tranche) backed by assets with sustainable, green and social responsibility elements. The A1-SU notes were issued under HKMC's Social Responsibility, Green and Sustainable Finance Framework, aligned with the International Capital Market Association's green bond principles, social bond principles and sustainability bond guidelines.
The Asian Infrastructure Investment Bank (AIIB) continued as anchor investor through its total US$300 million investment programme in HKMC's infrastructure loan mortgage securities, supporting its goal of channelling private capital into infrastructure.
Standard Chartered Bank acted as sole global coordinator. Joint bookrunners included BNP Paribas, China International Financial Hong Kong Securities Company, ING Bank Singapore branch, Mitsubishi UFJ Securities Asia Limited, Nikko Securities (Hong Kong) Limited and Standard Chartered Bank. Sub-underwriters were Fubon Bank (Hong Kong) Limited and Haitong International Securities Group Limited.