People鈥檚 Bank of China launches cross-boundary bond repo business
29 September 2025 Hong Kong
Image: YiuCheung/stock.adobe.com
The People鈥檚 Bank of China (PBoC) has officially launched a cross-boundary bond repo business, which has already seen firms harness the new measures for repo transactions.
The move comes as the PBoC aims to deepen the opening of the financial market and further facilitate liquidity management for overseas institutional investors.
The business was jointly advocated by the Hong Kong Monetary Authority (HKMA), the China 网爆吃瓜 Regulatory Commission (CSRC), and the State Administration of Foreign Exchange (SAFE).
Overseas institutional investors in the China Interbank Bond Market (CIBM) are all eligible to engage in the bond repo business, including those entering the market through both the CIBM Direct and the Bond Connect.
Specifically, the eligible types of investors include overseas central banks or monetary authorities, international financial organisations, and sovereign wealth funds, as well as various types of overseas financial institutions, including commercial banks.
In addition, overseas financial infrastructures, self-regulatory organisations, and industry associations may provide services for offshore institutional investors engaging in bond repo business in the CIBM.
For HKMA, this measure is another important policy initiative following the launch of the offshore RMB repo business by the authority in February.
The cross-boundary repo and offshore RMB repo businesses will address offshore investors鈥� needs of asset allocation and liquidity management, says HKMA.
Further, HKMA highlights that it will help activate offshore investors鈥� onshore bond holdings and further enhance the attractiveness of onshore bonds, thereby promoting the use of RMB as an investment and funding currency in the international markets.
Eddie Yue, chief executive of the HKMA, comments: 鈥淲e are pleased to launch the cross-boundary repo business. This is one of the key initiatives on which the HKMA and the PBoC have been working closely, to continuously enhance the Bond Connect business.
鈥淭his measure will bolster offshore RMB liquidity in Hong Kong, increase overseas investors鈥� interest in allocating to RMB assets, and promote more diversified development of offshore RMB businesses. This in turn will help consolidate and enhance Hong Kong鈥檚 status as an international financial centre and an offshore RMB business hub.鈥�
In line with the announcement, Standard Chartered Bank (Hong Kong) has officially completed onshore repo transactions through the China Interbank Bond Market with CITIC 网爆吃瓜 and through Bond Connect with China Construction Bank respectively.
John Thang, head of markets and strategic client management and solutions, Hong Kong, Greater China and North Asia, Standard Chartered, says: 鈥淢arking another milestone in the market, the newly launched cross-boundary bond repo business can meet international investors鈥� needs of diversified asset allocation and flexible liquidity management.
鈥淚t will also provide more stable liquidity support for Hong Kong鈥檚 offshore RMB market and lower the RMB funding cost in the long run.鈥�
According to Thang, Mainland China is the world鈥檚 second largest bond market, but the percentage of foreign holdings of onshore bonds is less than three per cent (as of end-August), demonstrating "huge room" for further growth.
Looking ahead, the PBOC, CSRC, and SAFE will continue to implement the overall strategic arrangements made by the CPC Central Committee and the State Council for expanding opening-up, balance financial openness and security, work with relevant parties to refine institutional arrangements, and steadily advance the high-level institutional opening-up of China's bond market.
Cheuk Wong, head of markets and securities services, Hong Kong at HSBC, comments: 鈥淔ollowing the launch of the cross-boundary bond repurchase business, overseas investors from a wide range of geographies, including Asia, the Middle East, and the UK, have utilised the enhanced access to the mainland market.
鈥淢any are keen to leverage Hong Kong鈥檚 strengths as an unrivalled RMB risk management and financing hub, tapping into a deeper and more stable pool of RMB liquidity.
鈥淭his development comes at a critical time as investors look to China bonds鈥� lower correlation with other major treasury markets as a pragmatic way to build resilience against global market volatility and diversify their portfolios.鈥�
The move comes as the PBoC aims to deepen the opening of the financial market and further facilitate liquidity management for overseas institutional investors.
The business was jointly advocated by the Hong Kong Monetary Authority (HKMA), the China 网爆吃瓜 Regulatory Commission (CSRC), and the State Administration of Foreign Exchange (SAFE).
Overseas institutional investors in the China Interbank Bond Market (CIBM) are all eligible to engage in the bond repo business, including those entering the market through both the CIBM Direct and the Bond Connect.
Specifically, the eligible types of investors include overseas central banks or monetary authorities, international financial organisations, and sovereign wealth funds, as well as various types of overseas financial institutions, including commercial banks.
In addition, overseas financial infrastructures, self-regulatory organisations, and industry associations may provide services for offshore institutional investors engaging in bond repo business in the CIBM.
For HKMA, this measure is another important policy initiative following the launch of the offshore RMB repo business by the authority in February.
The cross-boundary repo and offshore RMB repo businesses will address offshore investors鈥� needs of asset allocation and liquidity management, says HKMA.
Further, HKMA highlights that it will help activate offshore investors鈥� onshore bond holdings and further enhance the attractiveness of onshore bonds, thereby promoting the use of RMB as an investment and funding currency in the international markets.
Eddie Yue, chief executive of the HKMA, comments: 鈥淲e are pleased to launch the cross-boundary repo business. This is one of the key initiatives on which the HKMA and the PBoC have been working closely, to continuously enhance the Bond Connect business.
鈥淭his measure will bolster offshore RMB liquidity in Hong Kong, increase overseas investors鈥� interest in allocating to RMB assets, and promote more diversified development of offshore RMB businesses. This in turn will help consolidate and enhance Hong Kong鈥檚 status as an international financial centre and an offshore RMB business hub.鈥�
In line with the announcement, Standard Chartered Bank (Hong Kong) has officially completed onshore repo transactions through the China Interbank Bond Market with CITIC 网爆吃瓜 and through Bond Connect with China Construction Bank respectively.
John Thang, head of markets and strategic client management and solutions, Hong Kong, Greater China and North Asia, Standard Chartered, says: 鈥淢arking another milestone in the market, the newly launched cross-boundary bond repo business can meet international investors鈥� needs of diversified asset allocation and flexible liquidity management.
鈥淚t will also provide more stable liquidity support for Hong Kong鈥檚 offshore RMB market and lower the RMB funding cost in the long run.鈥�
According to Thang, Mainland China is the world鈥檚 second largest bond market, but the percentage of foreign holdings of onshore bonds is less than three per cent (as of end-August), demonstrating "huge room" for further growth.
Looking ahead, the PBOC, CSRC, and SAFE will continue to implement the overall strategic arrangements made by the CPC Central Committee and the State Council for expanding opening-up, balance financial openness and security, work with relevant parties to refine institutional arrangements, and steadily advance the high-level institutional opening-up of China's bond market.
Cheuk Wong, head of markets and securities services, Hong Kong at HSBC, comments: 鈥淔ollowing the launch of the cross-boundary bond repurchase business, overseas investors from a wide range of geographies, including Asia, the Middle East, and the UK, have utilised the enhanced access to the mainland market.
鈥淢any are keen to leverage Hong Kong鈥檚 strengths as an unrivalled RMB risk management and financing hub, tapping into a deeper and more stable pool of RMB liquidity.
鈥淭his development comes at a critical time as investors look to China bonds鈥� lower correlation with other major treasury markets as a pragmatic way to build resilience against global market volatility and diversify their portfolios.鈥�
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