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PBOC: Scope of Domestic Investors for Southbound Bond Connect to Be Expanded to Brokers, Funds, Insurance/ Wealth Mgmt Firms
Jiang Huifen, Deputy Director-General of the Financial Market Department at the People's Bank of China (PBOC), announced at the Bond Connect Anniversary Summit the introduction...
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PBOC: Scope of Domestic Investors for Southbound Bond Connect to Be Expanded to Brokers, Funds, Insurance/ Wealth Mgmt Firms
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Jiang Huifen, Deputy Director-General of the Financial Market Department at the People's Bank of China (PBOC), announced at the Bond Connect Anniversary Summit the introduction of three new opening-up enhancement measures to further deepen the mutual market access of the financial markets of mainland China and Hong Kong and to support the development of RMB in offshore markets.

The PBOC planned to expand the scope of domestic investors of the southbound Bond Connect to 4 types of non-bank financial institutions, including brokers, funds, insurance and wealth management, to support more domestic investors to “go global”.

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The authorities will optimize the mechanism and arrangements for offshore repurchase business under the Bond Connect to facilitate liquidity management by foreign investors, broaden the application scenario of offshore repurchases by expanding the scope of tradable currencies from RMB to multiple currencies such as USD, EUR and HKD, and support the Hong Kong CMUs to make reference to the international practice of repurchase of bonds by removing the freezing of pledge note repurchase and further revitalizing the pledge notes, so as to support Hong Kong CMUs to simplify business processes like bond account opening and enhance usability.

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