International law firm Simmons & Simmons has advised a syndicate of banks on the Infrastructure Loan-Backed Securities (ILBS) issuance under "Bauhinia 3", the third ILBS issuance originated by The Hong Kong Mortgage Corporation Limited (HKMC) in its Bauhinia series.
Bauhinia 3 offers professional investors exposure to 33 infrastructure loans across 12 countries and 9 sub-sectors, with a total portfolio value of approximately US$450.5 million. This strategic initiative aims to channel long-term capital for infrastructure development, fostering economic growth and market resilience.
The transaction comprised five classes of listed notes totalling US$427.9 million. Among these was a US$117 million sustainability tranche backed by green, social and sustainable assets -- the largest sustainability tranche in the Bauhinia ILBS series to date.
Notably, Bauhinia 3 introduced a diversified portfolio comprising not only infrastructure loans but also infrastructure bonds, with several assets denominated in currencies other than USD. .
The transaction underscores Hong Kong's growing role as a regional hub for infrastructure financing and highlights Simmons & Simmons' market-leading expertise in structured finance and securitisation across Asia.
Acting as legal counsel to the syndicate banks, covering roles as global coordinator, joint bookrunner and hedging provider, the team advised on legal structuring, due diligence, portfolio asset transfer, hedging arrangements, payment mechanics, as well as multi-jurisdictional regulatory compliance.
The transaction was led by Karen Lam (Partner, Head of Hong Kong Securitisation and Derivatives), with key contributions from Shikki Wang (Registered Foreign Lawyer) and Michelle Chitoo (Associate), and further international support from Simmons & Simmons' Structured Finance and Derivatives Group in London.
