Investors gave a lukewarm response to the government's short-term bond issue on its debut yesterday, with many put off by the low returns.
About 20 investors picked up prospectuses at HSBC's Nathan Road branch in Mongkok within the first hour of the offering, but some said they had not decided whether to invest.
'The coupon rate is a little bit low, so I'm still thinking about it. I will probably opt for other forms of investment,' said Li Kwok-man, a 32-year-old civil servant.
He was also hesitant because the US interest rate rise had cast a shadow over the prospects for investment. 'I invested $500,000 in the bond offering in April and the returns are much higher,' he added, referring to the previous bond issue.
Investors can subscribe to a two-year bond at a rate of 2.13 per cent or a four-year issue at 3.38 per cent, with a minimum subscription of $50,000.
Retiree Ng Ping-len, 69, said: 'It's issued by the government so it's more stable. Otherwise the money will just be lying in the bank and yield nothing.'