The green and sustainability-linked bond markets were initially fostered by public-sector issuance – and the world’s best bank in this category, HSBC, is anticipating that the same thing will also happen with tokenized bonds.
HSBC led two tokenized public-sector bond issues over the last year. The first, a £50 million note for the European Investment Bank was settled in February 2023. Shortly after, HSBC also led a HK$800 million ($102 million), one-year tokenized green bond for the Hong Kong SAR government – the first institutional tokenized green bond issued by a government issuer.
The deal met the administration’s desire to innovate in digital bonds – part of its strategy to position itself as a forward-looking financial centre.
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For HSBC, similar positive branding effects were welcome.