Done deal: Mortgage Corporation Deputy Chairman Joseph Yam and Chief Executive Officer Peter Pang attend the $3 billion MBS signing ceremony.

The Mortgage Corporation has issued $3 billion in mortgage-backed securities. The move concludes the second series of securities issued under the Bauhinia MBS Ltd US$3 billion Mortgage-Backed Securitisation Programme.

This set a new record of being the largest-ever Hong Kong-dollar-denominated residential MBS transaction after the successful debut issue completed in March last year.

It is divided into three classes of MBS of $1 billion each. All the three classes are due November 2024. The interest rate of class A-1 notes is 1-month HIBOR + 0.12% p.m., while class A-2 and A-3 notes are 1-month HIBOR + 0.18% p.m.

Monetary Authority Chief Executive Joseph Yam, who is also Deputy Chairman of the corporation, said: "The corporation is committed to developing a deep and liquid MBS market in Hong Kong as an effective means for enhancing the availability of competitive mortgage finance in Hong Kong for home buyers."

The corporation's Chief Executive Officer Peter Pang said: "With the backing of a sizeable portfolio and the substantial acquisitions lined up for 2004, the corporation intends to make good use of its two MBS Programmes to step up its securitisation activities."