Hong Kong Silver Bond 2028 — First Interest Payment, Yield Analysis, and Who Should Buy
Contents
TL;DR
The Silver Bond 2028 (Issue 03GB2810R) pays its first interest on April 10, 2026. The rate is the higher of a 3.85% fixed floor or a floating rate tied to Hong Kong CPI. Recent payments on the 2026 series have consistently paid 5% p.a. because inflation stayed below the fixed rate. For retirees aged 60+ looking for government-backed income, it remains one of the safest options in Hong Kong — but the 3-year lock-up and $1 million cap per person limit its appeal for younger investors.
What Is the Silver Bond 2028?
The Silver Bond is a Hong Kong government retail bond issued exclusively to residents aged 60 or above. The 2028 series (maturing October 2028) was issued in late 2025, and its first interest payment arrives on April 10, 2026.
Unlike regular fixed-rate bonds, Silver Bonds use a dual-rate mechanism: you receive whichever is higher — a fixed rate (3.85% for this series) or a floating rate based on the Composite Consumer Price Index (CCPI) over the preceding six months.
In practice, the fixed rate has dominated every payment cycle of the older 2026 series, which paid a steady 5% p.a. across all five coupon dates. Hong Kong CPI has hovered around 1-2%, well below the fixed floors.
First Interest Payment — What to Expect
The HKMA announced the first coupon details on March 24, 2026:
- Payment date: April 10, 2026
- Interest period: ~6 months since issuance
- Minimum guaranteed rate: 3.85% p.a. (applied to face value)
- Floating rate reference: CCPI change over prior 6 months
If the floating rate (latest CCPI around 1.17%) is below 3.85%, bondholders receive the fixed rate. Given current inflation, expect a payment based on the 3.85% floor — roughly HK$192.50 per HK$10,000 face value for this half-year period.
Silver Bond 2028 vs iBond vs Time Deposits
Choosing between these three depends on your age, liquidity needs, and risk tolerance.
| Feature | Silver Bond 2028 | iBond (latest) | Bank Time Deposit (6-month) |
|---|---|---|---|
| Minimum age | 60+ only | 18+ (HK resident) | Any |
| Annual yield | 3.85% floor (or CPI) | ~2.0% (CPI-linked, no floor) | 1.8-2.8% (varies by bank) |
| Government backed | Yes | Yes | HKDG insured up to HK$500K |
| Lock-up | 3 years (early redemption possible at slight penalty) | 3 years | 6-12 months |
| Max per person | HK$1,000,000 | HK$1,000,000 | No limit |
| Liquidity | Can sell on secondary market | Can sell on secondary market | Locked until maturity |
| Tax | Exempt from profits tax | Exempt from profits tax | Interest income taxable for businesses |
The Silver Bond wins on guaranteed yield — 3.85% vs roughly 2% for iBond and under 2.8% for most time deposits. The tradeoff is the age restriction and 3-year commitment.
Who Should Buy Silver Bonds?
Good fit:
- Retirees with idle cash in savings accounts earning under 1%
- Conservative investors who want government-backed income without stock market risk
- People who already maxed out their iBond allocation and want additional fixed income
Not ideal:
- Anyone under 60 (you literally cannot buy them)
- Investors who might need the money within 2 years — early redemption involves selling on the secondary market, possibly below face value
- People seeking returns above 4% — even the 3.85% floor is modest compared to US Treasury yields (currently around 4.2%)
How the Dual-Rate Mechanism Actually Works
The HKMA calculates the floating rate every six months using CCPI data. The formula:
Floating Rate = (CCPI at end of period / CCPI at start of period - 1) x 2
The "x 2" converts the six-month inflation figure to an annualized rate. If this number exceeds the fixed rate (3.85%), you get the higher floating rate. If inflation is negative — deflation — you still get the 3.85% floor. This downside protection is the Silver Bond's main advantage over iBond, which has no floor.
Looking at the track record: the 2026 Silver Bond series paid 5% on every coupon because its fixed rate was 5%. With the 2028 series, the lower 3.85% floor means returns will only match the older series if inflation rises significantly.
What Happens When the Silver Bond 2028 Matures?
At maturity (October 2028), bondholders receive the full face value plus the final coupon. No reinvestment is automatic — you'll need to decide whether to subscribe to a new series (if available) or redirect the funds.
The Hong Kong government has issued Silver Bonds annually since 2016, so a new series in 2028-2029 is likely. Historical trends show the fixed rate has ranged from 3.0% to 5.0%, generally tracking prevailing interest rates.
FAQ
Is the Silver Bond 2028 worth buying at 3.85%?
For eligible retirees with cash sitting in savings accounts at 0.5-1%, yes — the Silver Bond triples that return with government backing. But if you have access to higher-yielding options like fixed deposits at virtual banks (some offer 2.5%+ with no age restriction), the gap narrows. The Silver Bond's edge is the inflation floor and tax exemption.
Can I sell my Silver Bond before maturity?
Yes. Silver Bonds trade on the secondary market through your bank or broker. However, the market for Silver Bonds is thin — you might sell at a slight discount to face value if interest rates have risen since purchase. The HKMA does not guarantee the secondary market price.
How do I check my Silver Bond interest payments?
Interest is automatically credited to the bank account linked to your CCASS Investor Account on the payment date (April 10 and October 10 annually). Check with your bank or the HKMA bond programme page for exact rates.
Last Updated: April 4, 2026. Jim Liu is an investor based in Sydney covering Hong Kong and Australian fixed-income products. He holds iBond but not Silver Bond (under 60).