AfDB issues 2 billion HKD social bond

The African Development Bank (AfDB) issued a 2 billion Hong Kong dollar (HKD) "social" bond on October 28, repayable on November 6, 2031, with a coupon of 4.143% and executed at par. This bond, named "Wonton," is the second public operation of the AfDB in Hong Kong dollars since March 2026.

Understanding "Wonton" bonds

A "Wonton" bond is a debt instrument denominated in HKD, issued by international entities on the Hong Kong market. The first such issuance by the AfDB was 3 billion HKD, placed over a period of three years and three months at a rate of 2.615%.

Financing strategy and market response

The new loan allows the institution to extend the duration of its financing on this market, even though its amount is lower than that of March. The order book for the new bond exceeded 3.4 billion HKD, allowing the bank to bring the compensation margin three basis points above the zero HIBOR mid-swaps reference rate.

Investor distribution

Approximately 2.05 billion HKD of the order book came from the leading banks of the operation. Investors in Hong Kong obtained 97% of the bonds, compared to 3% for the rest of Asia. Bank treasuries absorbed 91% of the issuance, with asset managers sharing the remainder.

Leading banks in the placement

HSBC and Standard Chartered led the placement, whose settlement is scheduled for November 6. This operation took place a week after a 2.5 billion US dollar loan placed on October 21, with a maturity of January 2030, accompanied by a coupon of 4.875% and a yield of 4.933%.

Complementary financing approaches

The order book for the dollar loan reached 4.8 billion dollars, with only 50 million of intentions from the leading banks, with subscribers distributed between Europe, the Americas and Asia. These two issuances respond to complementary logics: the major references in dollars ensure large volumes, while placements in Asian currencies diversify investors and refinancing possibilities.

Sustainable financing focus

Labeled as social, the Hong Kong bond fits into the framework of sustainable financing of the AfDB.