Bond Connect Company Limited’s Post

Bond Connect Flash Report for June 2024 - In June, the monthly trading volume was RMB 833.2 billion, and the monthly average daily turnover stood at RMB 43.9 billion. Chinese government bond and policy financial bond were the most popular bond types, accounting for 37% and 43% of the trading volume respectively. - In June,443 transactions were traded through the Northbound Swap Connect, with volume of RMB 256.141 billion. By the end of June, 63 overseas institutions were onboarded under Northbound Swap Connect. - ePrime Issuance Service successfully facilitated 11 issuances with total issue size of RMB 10.202 billion equivalent in June. Participating underwriters of this month, listed in alphabetical order, included Bank of China, China Securities International, CITIC Securities, Guotai Junan International, Huatai International, Orient Securities (Hong Kong), Shanghai Pudong Development Bank Hong Kong Branch, and TF International. - On 15 June, the latest round of enhancements for ePrime Issuance Service was launched. New Enhancement features included access management, order filter, orderbook UI customization, quick order edit, password reset, etc. - PMIP disclosed the pre- and post-issuance information of 69 primary bonds in June. Stay tuned for more updates and upcoming events. Subscribe to us now: https://lnkd.in/g-icFkjh Regarding the applicable disclaimer for posts on LinkedIn, please refer to our company website: https://lnkd.in/gYnQzuym #BondConnect #BCCL #ChinaBond #FlashReport

China Securities Regulatory Commission's decision to suspend securities relending may have raised concerns, but experts believe the impact on institutional investors will be minimal. The onshore securities lending balance has dropped significantly this year, from CNY71.6 billion ($9.9 billion) to CNY31.8 billion ($4.4 billion), reflecting a shrinking market influenced by tighter regulations. Additionally, the daily trading volume of stocks sold through securities lending on the Chinese mainland market has decreased from 0.7% to 0.2%. Mutual funds' securities lending has also seen a notable reduction. However, alternative methods like direct lending agreements with major shareholders offer viable options for obtaining securities, lessening the disruption caused by the relending suspension. In essence, while the suspension of securities relending aligns with China's regulatory tightening, its effects on institutional investors are expected to be modest. The market has adapted to previous regulations, and investors have shown resilience. Regulators seem to tell retail investors that the market's short-selling power is weak, so feel confident about buying stocks.#China #stockmarket #regulators #shortselling #retailinvestors

Bond Connect Flash Report for September 2024 - Northbound Bond Connect: the monthly trading volume for September was RMB 812.5 billion, and the monthly average daily turnover stood at RMB 38.7 billion. Chinese government bond and policy financial bond were the most popular bond types, accounting for 38% and 41% of the trading volume respectively. - Northbound Swap Connect: 631 transactions were traded in September, with volume of RMB 385.077 billion. By the end of September, 65 overseas institutions were onboarded under Northbound Swap Connect. - ePrime Issuance Service successfully facilitated 13 issuances with total issue size of RMB 14.06 billion equivalent in September. Participating underwriters of this month, listed in alphabetical order, included Bank of China, China CITIC Bank International, China International Capital Corporation, China Securities International, CITIC Securities, CNCB Capital, Guotai Junan International, ICBC International, and TF International. - BCCL held a Singapore roadshow to engage with investors, aiming to understand their investment focuses and gather market feedback amid the recent policy announcements. BCCL also attended the local joint event “RMB Bond and Derivatives Market Outlook”, hosted by Bank of China Singapore Branch and Orient Securities, as a panelist to share insights on RMB bonds, and highlight new trends and opportunities in the derivatives market. - On 5 September, Bond Connect series event featured NAFMII and Bank of China on “The Rise of Panda Bond and Investment Opportunities”, exploring the current market landscape, pricing dynamics and investment opportunities of panda bonds, and illustrating how to access panda bonds in the primary market with ePrime system. - PMIP disclosed the pre- and post-issuance information of 72 primary bonds in September. Stay tuned for more updates and upcoming events. Subscribe to us now: https://lnkd.in/g-icFkjh Regarding the applicable disclaimer for posts on LinkedIn, please refer to our company website: https://lnkd.in/gdWW4pba #BondConnect #BCCL #ChinaBond #FlashReport

A number of Chinese brokerages have temporarily halted their securities lending business, only allowing the return of securities lent and banning any further borrowing. A source said that China's Top four onshore brokerages, which have the largest lending pools of stocks, have suspended securities financing. These firms have not said when the pool will re-open.   Wind Information showed that as of April 10 China's onshore stock market margin trading and securities lending balance is CNY 1,428.9 billion ($ 197.46 billion), of which the margin trading balance was CNY1,397.7 billion ($193.15 billion). There was CNY 31.1billion (USD4.3 billion) of outstanding securities lending on the Chinese stock markets as of the close of markets April 10th, this is a contraction of 40% from April 2023 The country’s securities watchdog China Securities Regulatory Commission started to crack down on securities lending earlier this year, banning the increase in the scale of the lending pool and barring illicit behaviors such as T+0 trading. Most retail investors believe that securities shorting is one of the reasons why China's stock market has slumped in recent years. #China #stockmarket #margintrading #securitieslending

Optimizing Management of the Domestic Securities and Futures Investment Capital of Qualified Investors to Steadily Promote High-Standard Institutional Opening-Up of the Financial Market The amended Regulations contains the following key changes: 🗨  Simplified business registration rocedures.  The Regulations states that registration for QFII/RQFII businesses is completed by the principal reporter (custodian) through SAFE's ASOne platform. It also clarifies the rules for change of registered information and deregistration. 🗨  Optimized account management. The dedicated RMB deposit accounts for securities trading or derivatives trading are merged to reduce the number of accounts that need to be opened for various types of investment, with cost-saving effects. 🗨  Improved foreign exchange rules. The rules for cross-border capital flows of QFIIs and RQFIIs have been optimized, in particular the rules on which currencies can be transferred into and out of China, to make it easier for foreign institutional investors to invest in domestic securities. 🗨  Unified FX risk management model for QFII/RQFII and CIBM.  The Regulations permits QFIIs and RQFIIs to complete the spot purchase and sale of foreign currencies and FX derivatives transactions through a domestic financial institution qualified to provide such foreign-currency services or China’s interbank FX market, in addition to their custodians, on condition that such activities are based on bona fide transactions or hedging needs. #FX #riskmanagement #QFII #RQFII #CIBM #regulation

OTC Clear to Accept China Government Bonds and Policy Bank Bonds as Collateral for SWAP Connect On December 16, Hong Kong Exchanges and Clearing Limited (HKEX) announced that its clearing subsidiary, OTC Clearing Hong Kong Limited (OTC Clear), will allow offshore investors to use China Government Bonds and Policy Bank Bonds held through Bond Connect as collateral for Northbound Swap Connect beginning 13 January 2025. The new eligible collateral can be used to cover initial margin requirements of Northbound Swap Connect, providing greater flexibility to international investors and enhancing their capital efficiency. It will also help vitalise international investors' bond holdings in the China Interbank Bond Market, promoting the internationalisation of the RMB. The new eligible collateral can be used to cover initial margin requirements of Northbound Swap Connect, providing greater flexibility to international investors and enhancing their capital efficiency. It will also help vitalise international investors' bond holdings in the China Interbank Bond Market, promoting the internationalisation of the RMB. As of the end of November 2024, a total of 71 overseas institutions have participated in Northbound Swap Connect. The average daily turnover of Swap Connect totalled RMB 18.2 billion in November 2024, up sharply from about RMB 3 billion in May 2023. Further details related to this enhancement to Northbound Swap Connect will be updated on HKEX website in due time.

@CSRC Approves Suspension of Securities Lending Business to Strengthen Countercyclical Regulation 📉🔒 In response to investor concerns and to maintain market stability, the China Securities Regulatory Commission (CSRC) has approved the suspension of securities lending by China Securities Finance Corporation Ltd., effective from July 11, 2024. Existing contracts can be extended but must be settled by September 30. The margin ratio for securities lending will be raised to 100%, and for private securities investment funds to 120%, starting July 22, 2024. These measures are part of ongoing efforts to reduce market impact and ensure regulatory compliance, aiming to stabilize irrational fluctuations and safeguard investor interests. 📊🔍 👉 Read more: https://lnkd.in/gNwc-_JN #SSE #ShanghaiStockExchange #CSIIndex #ETF #2024 #mainland #China #HongKong #investors #Stock #MarketShare #ChinaSecurities #BondMarket #MaketEconomy #Listedcompany #Trading #InvestChina #CSRC #SecuritiesLending #MarketStability #Regulation #InvestorProtection #Finance #ChinaFinance #MarketRegulation

Bond Connect Flash Report for May 2024  - In May, the monthly trading volume was RMB 979.2 billion, and the monthly average daily turnover stood at RMB 46.6 billion. Chinese government bond and policy financial bond were the most popular bond types, accounting for 42% and 41% of the trading volume respectively. - In May, 687 transactions were traded through the Northbound Swap Connect, with volume of RMB 402.987 billion. By the end of May, 61 overseas institutions were onboarded under Northbound Swap Connect. - To mark the 1st year milestone of Swap Connect, BCCL held an online seminar titled “The Next Phase of Swap Connect” on 16 May. The seminar invited CFETS, SHCH, HKEX and NAFMII to introduce the important progress and latest enhancements of Swap Connect scheme, and to discuss relevant market feedback. - ePrime Issuance Service successfully facilitated 5 issuances with total issue size of RMB 6.736 billion equivalent in May. Participating underwriters, listed in alphabetical order, included China Securities International, CITIC Securities, Guotai Junan International, Huatai International, ICBC International, and TF International. - On 23 May, ePrime Northbound Subscription Service supported offshore investors’ cross-border subscription of Bank of Nanjing Co., Ltd.’s RMB 26 billion 3-year 2024 Financial Bonds (Series 1) priced at a 2.24% yield. The seamless connectivity actualized between ePrime and the Bond Issuance, Underwriting and Distribution system of CFETS (iDeal) allowed offshore investors to complete their subscriptions successfully, which encompassed order placement, allocations, and the generation of confirmation tickets. - On 14 May, BCCL and ICBC International jointly hosted an online event themed “Thriving in Flux: Unlocking China's Bond Market Value”. Joined by ICBC, Fidelity International and Manulife Investment Management HK, the event shared insights on China's macroeconomy in the second half of 2024, investment opportunities in China’s bond market, the market opening-up and development, as well as Swap Connect scheme. - PMIP disclosed the pre- and post-issuance information of 197 primary bonds in May, including policy financial bonds, financial bonds, tier-2 capital bonds and medium-term notes. Stay tuned for more updates and upcoming events. Subscribe to us now: https://lnkd.in/g-icFkjh Regarding the applicable disclaimer for posts on LinkedIn, please refer to our company website: https://lnkd.in/gFYCBVsp #BondConnect #BCCL #ChinaBond #FlashReport

China’s Bond Connect to Slash Fees by 60%, Most Since Launch https://lnkd.in/guVr7h7j Bond Connect Company Limited (BCCL) will reduce its service fees by 60% starting January 1, 2025—the largest reduction since the program's inception in 2017 and the fourth overall. Fees for bonds with a remaining term of one year or less will decrease from 0.0015% to 0.0006% of the nominal value, while those with terms exceeding one year will drop from 0.0030% to 0.0012%. This move aims to lower transaction costs for overseas investors and enhance the efficiency of the Bond Connect mechanism, which has seen significant growth, with over 800 investors from nearly 40 jurisdictions and a record average daily trading volume of RMB 43.1 billion in the first ten months of 2024.  #China #Hongkong #Chinaeconomic #Policy #Bondconnect #Bond #Crossborder #Finance #InvesTAODigest

The People's Bank of China officially released "the establishment of share repurchase and holding re-lending last Friday, over the weekend, there have been the first batch of 23 listed companies quickly responded. October 20 evening, these companies issued share repurchase or purchase announcements related to re-lending program.   The first mover is China Petroleum & Chemical Corporation (SINOPEC), the company's controlling shareholder, SINOPEC Group, signed a loan agreement with Bank of China, obtaining a credit line of CNY 700 million ($98.57 million), specifically for Sinopec Group to purchase Sinopec A shares (SH.600028) and increase its shareholding.   After the above loan is granted by the Bank of China, the bank may apply to the People's Bank of China for a refinancing loan. The People's Bank of China will provide refinancing at 100% of the principal amount of the loan. The initial total refinancing amount is CNY300 billion ($42.24 billion), with an interest rate of 1.75% per annum and a term of one year.   The vast majority of listed companies have disclosed that the annualized interest rate for loans is around 2.25%. If China's commercial banks can use this tool flexibly, they can actively support share buybacks and acquisitions by listed companies with good governance and prospects. This will benefit the whole capital market.#China #stockmarket #share #buyback #loans #centralbank