"Amidst the complexities of geopolitics and intensified fluctuations in the US dollar's exchange rate, Hong Kong dollar bonds have emerged as a high-quality alternative to dollar assets, offering both stability and appeal, thereby continuing to attract cross-border capital inflow."
Jameson Zuo
Director, Ratings, CSPI Ratings
News Report Summary
In January 2026, the Asian Infrastructure Investment Bank (AIIB) issued public bonds totaling HKD 4 billion, drawing attention to the niche category of "Wonton Bonds" — debt instruments issued by offshore entities in the Hong Kong market denominated in HKD.
Since last year, the issuance of Wonton Bonds has gained momentum, with significant increases in both scale and frequency. Industry experts attribute this growth to factors such as the low interest rate advantage of the HKD, local institutional asset allocation, and diversified financing needs. Wonton Bonds complement Dim Sum Bonds, contributing to enhanced depth and breadth in the Hong Kong's bond market.
Ongoing Public Issuance
Globally, bonds are often named following the tradition of combining cultural symbols with bond types, such as Dim Sum Bonds and Panda Bonds. Wonton Bonds, on the other hand, are HKD-denominated bonds issued by offshore entities in Hong Kong. Unlike the well-known Dim Sum Bonds, which are offshore RMB bonds, the key distinction lies in their issuance currency.
The scale and frequency of Wonton Bond issuance have significantly increased since last year. According to Bloomberg data, total issuance reached HKD 81.44 billion in 2025, with 105 transactions—representing major year-on-year growth of 216.6% and 98.1%, respectively.
Historically, international issuers favored private placements for HKD bonds, resulting in limited issuance. However, recent trends indicate a rise in public debentures. Notable issuers include various high-rated financial institutions, such as AIIB, the Asian Development Bank, and the International Finance Corporation (IFC).
Jameson Zuo, Director of Ratings at CSPI Ratings told to the reporter that, the investor base also demonstrates diversity, with participation from local banks, insurance companies, and various cross-border investors via the southbound trading channel, including central banks from Southeast Asia, Middle Eastern sovereign funds, and global asset management firms.
Factors Boosting Wonton Bond Issuance
Industry professionals believe multiple factors are contributing to the surge in Wonton Bond issuance, likely enhancing secondary market activity.
Currently, the ample liquidity in the HKD presents a clear low-interest advantage, particularly as the Federal Reserve enters a rate-cutting cycle, leading to a concurrent decline in the Hong Kong Interbank Offered Rate (HIBOR). Jameson notes that since May 2025, ongoing capital inflow and measures by the Hong Kong Monetary Authority to stabilize the currency have resulted in markedly increased HKD liquidity, propelling HIBOR downwards. This creates a distinct advantage for HKD financing compared to dollar borrowing, especially given the unique characteristics of Hong Kong’s linked exchange rate system.
The need for issuers to diversify their financing channels is another driving force for Wonton Bonds. Jameson emphasizes that, amid escalating geopolitical complexities and dollar exchange rate volatility, HKD bonds serve as an attractive alternative to dollar assets, continuously drawing cross-border capital. Issuing HKD bonds also enables institutions to accurately match their HKD business in Asia, effectively reducing exchange rate risks due to currency mismatches—making it a critical choice for optimizing financing structures.
Furthermore, respondents agree that Hong Kong's mature financial infrastructure, including the Central Moneymarkets Unit (CMU) for debt instruments and enhanced market connectivity, along with the government’s initiatives to promote green and sustainable finance, provide a favorable ecosystem for Wonton Bonds’ development.
Enhancing Hong Kong's Bond Market Depth and Breadth
The rise of Wonton Bonds signifies Hong Kong's transition from a mono-currency bond market to a comprehensive international bond center serving dual local and global demands.
"The AIIB's re-entry into the Wonton Bond market in 2026 underscores the maturation of the HKD bond market and reflects growing international investor recognition," observed Simon Yuen, Head of Capital Markets for Greater China and North Asia at Standard Chartered Bank, which co-managed the AIIB's latest Wonton Bond issuance.
In the short term, the vibrant Wonton Bond market may exhibit cyclical traits linked to the expanding HKD-US dollar spread. However, many believe that over the long term, Wonton Bonds are set to become a normalized product and a core segment of Hong Kong’s bond market.
Jameson Zuo notes that as the Wonton Bond market gains momentum, coupled with the demonstration effect from high-rated issuers and continuous improvements in the bond market’s connectivity and financial infrastructure, the asset class is likely to see sustained growth in scale, evolving towards increased diversification among issuers and investors, ultimately enhancing the market's ecosystem.
About CSPI Ratings
CSPI Ratings (Full name: CSPI Credit Rating Company Limited) is a leading global credit rating agency headquartered in Hong Kong. Licensed by the Hong Kong Securities and Futures Commission (SFC) since 2012, we provide world-class credit insights, combining global benchmarks with an emerging market perspective.
In 2025, CSPI Ratings was recognized by the Mandatory Provident Fund Schemes Authority (MPFA) as an "Approved Credit Rating Agency," joining Hong Kong’s MPF regulatory framework. As of the end of 2024, MPF total assets reached approximately HKD 1.3 trillion.
CSPI Ratings’ analytical excellence is widely recognized. In 2025, we received DMI’s "Best Internationalization Award for a Chinese Rating Agency,". In addition, The Asset named us "Public Finance Rating Agency of the Year – China" in 2024, 2023, and 2022. The China (Macao) Financial Assets Exchange (MOX) also awarded us the "2025 Internationalization Award for Chinese Credit Rating Agencies".
As a member of China Securities Credit Investment Group, CSPI Ratings leverages a strong network of 34 leading Chinese financial institutions. As the international brand of CSCI Pengyuan, we bridge global investors with trusted credit insights.
Rating Services
Email: globalservice@cspi-ratings.com
Media
Email: media@cspi-ratings.com