var faq = new PULL_DOWN_MENU();
with (faq) {
HKMC_BasePath(BaseHref);
HKMC_AddTitle("");
HKMC_AddSubTitle("");
HKMC_AddSubTitleDesc("What are HKMC's retail bonds?");
HKMC_AddContent("The retail bonds represent direct, unsecured and unsubordinated debt securities issued by The Hong Kong Mortgage Corporation Limited to retail investors through designated placing banks.");
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HKMC_AddSubTitleDesc("Why does HKMC issue retail bonds?");
HKMC_AddContent("a) To enhance the HKMC's fund-raising capabilities by broadening its investor base to include retail investors.
b) To promote the development of an active retail bond market in Hong Kong.
c) To meet the increasing investor demand for high quality retail bonds, evidenced by the enthusiastic responses to retail bond issues of the Corporation as well as other issuers.");
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HKMC_AddSubTitleDesc("What are the benefits of investing in HKMC's retail bonds?");
HKMC_AddContent("HKMC retail bonds are a stable investment that provides steady interest income to investors. The HKMC is wholly owned by the Hong Kong SAR Government through the Exchange Fund and is rated Aaa by Moody's and AA by S&P as a long-term, local currency issuer. It should be noted that, however, neither the HKSAR Government nor the Exchange Fund guarantees these bonds.
HKMC retail bonds carry higher yields than Exchange Fund Notes of comparable tenors.
HKMC retail bonds are covered by a market-making arrangement through an agreement made with the placing banks, whereby the banks quote firm bid prices for the retail bonds during business hours until their maturity dates. The Corporation sets aside 30% of the issue amount (or as specified in the issue prospectus) for the placing banks to tap into should the need arise, facilitating offer price quoting.
HKMC retail bonds are a flexible investment instrument with a small minimum denomination (HK$50,000 or US$5,000), low transaction costs (0.15% subscription fee) and different tenors and structures to suit the varying needs of different types of individual investors.
HKMC retail bonds can be conveniently subscribed for through the placing banks' designated branches.");
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HKMC_AddSubTitleDesc("How can retail investors apply for the retail bonds?");
HKMC_AddContent("Retail investors intending to subscribe for HKMC retail bonds need both a bank account and an investment account at the placing bank of their choice. For those investors who have not opened these accounts, they are encouraged to do so. A retail investor may apply for the retail bonds through the following method:
Application in person through a designated branch of a placing bank
Investors may go to any designated branch of a placing bank and apply in person there.");
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HKMC_AddSubTitleDesc("What price will retail investors pay for the HKMC retail bonds?");
HKMC_AddContent("When an investor applies for retail bonds, he or she is required to pay the application price, plus an additional handling fee of 0.15% of the application price. The actual price investors are required to pay for the retail bonds allotted is the total of the subscription price, and a handling fee of 0.15% of the subscription price.
Application Price: The application price is set at 102% of the principal amount of each tranche of retail bonds applied for or as specified in the issue prospectus. The minimum denomination of a bond is HK$50,000 or US$5,000; subsequent increase is in multiples of HK$50,000 or US$5,000.
Subscription Price: The subscription price of each tranche of retail bonds is its actual purchase price, which is specified in the issue prospectus or determined at or around 11:30 a.m. on the price fixing date. The annualised yield of each tranche of retail bonds will be fixed to equate to the annualised yield of the specified Exchange Fund Note (EFN) plus a spread, or as specified in the issue prospectus.
Any difference between the application price and subscription price for each tranche is dealt with in the following manner:
If the application price exceeds the subscription price, the relevant part of the application monies will be refunded;
If the subscription price exceeds the application price, the successful applicants are required to make additional payment to make up the difference.");
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HKMC_AddSubTitleDesc("What is the allocation method?");
HKMC_AddContent("If the total valid application amount for a tranche of retail bonds exceeds the amount to be issued (as determined by the HKMC at its discretion), all accepted applicants will be allocated a bond with a minimum of HK$50,000 or US$5,000 in principal amount. The remaining will be allocated to investors on a pro rata basis according to the number of bonds for which he or she validly applied (rounded down to the nearest whole bond). For the bonds that remain after rounding, they will be allocated by way of a ballot executed by the paying agent.");
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HKMC_AddSubTitleDesc("How do retail investors hold their retail bonds?");
HKMC_AddContent("The HKMC does not issue individual certificates for retail bonds, so investors must arrange for a placing bank to hold the bonds in a securities or investment account, which may be opened at the investor's request. HKMC retail bonds cannot be purchased without such an account.
Placing banks hold the bonds at the Central Moneymarkets Unit Service (CMU), a clearing system open only to institutions, run by the Hong Kong Monetary Authority. Individual investors may not open a personal account at the CMU. The HKMC pays the relevant interest and principal on the bonds to the placing banks' accounts at the CMU, and in turn, these banks credit the payments to the accounts of individual investors.
Any notices the HKMC gives after the retail bonds are issued will be given in the same way, and retail investors will have to rely on their placing banks to forward the notices to them.");
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HKMC_AddSubTitleDesc("How can retail investors trade the retail bonds in the secondary market?");
HKMC_AddContent("The placing banks have agreed with the HKMC to make a market for the retail bonds. In other words, a firm bid price will be quoted by the placing banks so that investors can sell their holding if needed.
The placing banks have also agreed to quote a firm offer price for the retail bonds so long as they may request the HKMC to issue additional retail bonds (up to a maximum of 30% of the initial issue amount or as specified in the issue prospectus), and thereafter the offer price will be quoted on a best effort basis.
Prices of HKMC retail bonds may fall as well as rise.");
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HKMC_AddSubTitleDesc("What are the factors affecting the market price of retail bonds and where can investors obtain information about the current yield level?");
HKMC_AddContent("After the issue date, the price of the retail bonds will vary depending on many factors including, but not limited to, prevailing interest rates. Generally, the price will rise when there is a fall in interest rates, and vice versa.
Retail investors can find out the current price and yield of retail bonds from the placing banks.");
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HKMC_AddSubTitleDesc("What are the transaction costs to subscribe for and hold the retail bonds?");
HKMC_AddContent("Investors are required to pay a handling fee of 0.15% of the subscription price of the retail bonds allotted to them.
As the retail bonds are scripless and the allotted retail bonds will be credited to the investment account of the investor's chosen placing bank, the placing banks will charge a fee for opening and operation of an investment account. Investors should consult the placing banks for the relevant fee level.");
HKMC_DisplayContent();
}