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What Are Exchange Fund Bills & Notes (EFBNs)? Exchange Fund Bills and Notes are debt securities issued by the Hong Kong Monetary Authority (HKMA) to manage liquidity in Hong Kong’s banking system. It is a key tool for controlling how much cash is available in the banking system. Exchange Fund Bills (EFBs): Short-term securities (91 days, 182 days, or 364 days) Sold at a discount to face value (the difference is the yield) No interest payments Exchange Fund Notes (EFNs): Longer-term securities (2, 5, 10, or 15 years) Pay semi-annual interest (coupon payments) Return principal at maturity Why Do EFBNs Matter? Every EFBN transaction affects the Aggregate Balance - the total amount of money in Hong Kong banks’ clearing accounts with the HKMA. This is essentially the banking system’s interest paying “liquidity pool.” The Net Injection or Absorption amount shown below should have some predictive power of the amount of the “Interest Payment/Issuance of Exchange Fund Bills and Notes” shown in the HKMA’s Daily Monetary Statistics on the same day. The Cash Flow Mechanics: When EFBNs are issued: Banks buy securities from HKMA Money flows OUT of the Aggregate Balance Result: Less liquidity in the banking system When EFBNs mature or pay coupons: HKMA pays banks back (principal + interest) Money flows INTO the Aggregate Balance Result: More liquidity in the banking system Understanding the Net Flow: Net Flow Maturities - Issuances Example: - If $3,000M matures and $2,500M is issued - Net Flow +$500M (liquidity injection) - Aggregate Balance increases by $500M February 2026 Date Type Scheduled Issuance*(HK$ Mn) Confirmed Issuance**(HK$ Mn) Maturing EFBNs***(HK$ Mn) Net Injection / (Absorption)(HK$ Mn) Issue Number for Maturing EFBNs 25 Feb Bills 81,198 N/A 81,499 301 H2564, Q2548 23 Feb Notes 0 N/A 1,200 1,200 02Y2602 23 Feb Coupons 0 N/A 31 31 23 Feb Bills 1,200 N/A 0 (1,200) 20 Feb Bills 80,118 N/A 80,118 0 H2563, Q2547 19 Feb Coupons 0 N/A 17 17 18 Feb Coupons 0 N/A 20 20 11 Feb Bills 84,365 84,264 84,365 101 Y2586, H2562, Q2546 04 Feb Bills 77,730 77,754 77,730 (24) H2561, Q2545 *Scheduled Issuance comprises of issuance amounts indicated in this quarterly tentative schedule published by HKMA. **Confirmed Issuance shows the discounted amount the HKMA received through issuing the bills and notes on the tender date. ***Positive Net Flow indicates liquidity injection into the Aggregate Balance; Negative indicates absorption. Previous Data January 2026 Date Type Scheduled Issuance*(HK$ Mn) Confirmed Issuance(HK$ Mn) Maturing EFBNs(HK$ Mn) Net Injection / (Absorption)(HK$ Mn) Issue Number for Maturing EFBNs 28 Jan Bills 78,315 78,307 78,315 8 H2560, Q2544 21 Jan Bills 76,883 77,105 76,883 (222) H2559, Q2543 14 Jan Bills 93,146 93,070 93,146 76 Y2585, H2558, Q2542 07 Jan Bills 89,060 89,035 89,060 25 H2557, Q2541 *Scheduled Issuance comprises of issuance amounts indicated in this quarterly tentative schedule published by HKMA. **Confirmed Issuance shows the discounted amount the HKMA received through issuing the bills and notes on the tender date. ***Positive Net Flow indicates liquidity injection into the Aggregate Balance; Negative indicates absorption. About This Data This table is updated regularly using official HKMA data sources: Daily tender results announcements Tentative issuance schedules Historical liquidity statistics The data helps track Hong Kong’s monetary operations and their real-time impact on banking system liquidity.

Tag: EFBNs

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