Subscription of the HK Mortgage Corporation's retail bonds has reached $1.204 billion, exceeding the minimum issue amount of $150 million by seven times.

The three-year (HKMC308 Notes), three-year extendable for two-year (HKMC309E Notes) and seven-year (HKMC702 Notes), carry coupons of 2.25%, 3.1% and 4% respectively, payable semi-annually. The retail bonds saw application amounts of $431 million, $134 million and $639 million respectively.

Corporation Chief Executive Officer Peter Pang said: "We are very pleased to see the strong demand by retail investors. Including this issue, the corporation has raised over $8.6 billion through retail bonds since we introduced the mechanism to offer bonds through Placing Banks in October 2001."

Prices to be fixed on Friday

Prices for the Notes will be fixed on February 20 by reference to the relevant Exchange Fund Notes as specified in the Prospectus. Retail investors will be informed shortly by letter of the prices of the Notes and the settlement details by the Placing Banks through which they applied for the Notes.

The Placing Banks will act as Market Makers to quote firm bid prices for the three corporation Notes during office hours until the maturity of the bonds. An additional 30% of the total issue amount will be held in reserve to support the market making activities of the Placing Banks in the secondary market.

The Placing Banks will quote firm offer prices until the reserve amount is exhausted, and will continue to do so on a best efforts basis.

The 14 Placing Banks are the Bank of China (HK), Bank of Communications, Bank of East Asia, Chiyu Bank, DBS Bank, Hang Seng Bank, HSBC, ICBC (Asia), International Bank of Asia, Liu Chong Hing Bank, Nanyang Commercial Bank, Shanghai Commercial Bank, Standard Chartered Bank and Wing Lung Bank.