Bloomberg and CFETS Jointly Launch New Solutions to Facilitate Trading on Southbound Bond Connect

The new solutions will enable offshore dealers to provide market-making services for onshore investors

Shanghai and Hong Kong – Together with China Foreign Exchange Trade System (National Interbank Funding Center) (“CFETS”), Bloomberg will launch new solutions[1] on September 24, based on the system connectivity between both parties, to facilitate seamless trading on the Southbound Bond Connect. The new solutions will enable offshore dealers to provide market-making services for onshore investors. Bloomberg will provide security master data and valuation data for eligible securities and the relevant data will be displayed on the CFETS platform upon launch.

This afternoon, the People’s Bank of China and Hong Kong Monetary Authority jointly announced that Southbound Bond Connect will commence on September 24, offering onshore Chinese investors the option to invest in Hong Kong’s bond market.

“The commencement of Southbound Bond Connect is another important step as China’s bond market moves towards further integration with global financial markets,” said Zhang Yi, President of CFETS. “In recent years, CFETS has been facilitating the participation of offshore investors in China’s interbank bond market. In this course, Bloomberg has worked closely with us as a critically important technology partner. Today’s announcement is another meaningful step together, to facilitate onshore investors to tap the offshore bond market. CFETS will continue to make cross-border investments more accessible, to better meet investors’ demand. We look forward to working even more closely with Bloomberg.”

“The global financial community has been anticipating the expansion of the Bond Connect program, which creates a gateway to opportunity for Chinese capital,” said Bing Li, Head of Asia Pacific at Bloomberg L.P.  “The opening of the southbound link is significant as it not only strengthens Hong Kong’s position in bond financing but will pave the way for accelerated investment flows across Greater China, offering onshore investors the opportunity to diversify their portfolios offshore. We value our partnership with CFETS and look forward to advancing China’s financial markets and further facilitating cross-border investments with our robust data, technology and network.”

Through the southbound trading program, qualified onshore investors can initiate a request for quote from CFETS’ bond trading platform to user-selected offshore dealers that use Bloomberg solutions. Each dealer provides pricing in response to the request on Bloomberg’s Trade Order Management System (TOMS), which is connected to CFETS’ bond trading platform through the new Bloomberg Southbound Bond Connect solution. Offshore market makers will benefit from Bloomberg TOMS automated pricing and trading workflows, enabling greater efficiency without disruption to current market-making businesses.

Bloomberg is also one of the data sources selected by CFETS to enhance market transparency of Southbound Bond Connect. Security master data and Bloomberg Evaluated Pricing (BVAL) data of eligible securities will be displayed on the CFETS bond trading platform for onshore investors. It is the first time onshore investors in China can view BVAL data on a third party system. In addition, onshore investors can also access comprehensive pricing and analytical tools on the Bloomberg Terminal.

Bloomberg TOMS is an award-winning order and execution management system (OEMS) for front-office trading, compliance and operations, supporting fixed income, derivatives and FX. Bloomberg’s integrated suite of solutions for the sell-side help more than 16,300 users across the world manage positions, trade orders, assess multi-asset risk and optimize execution.  Bloomberg’s Evaluated Pricing service, BVAL, supplies independent and transparent evaluated pricing daily for over 2.5 million securities across all asset classes, including thinly-traded and hard-to-price fixed income securities.

For more information on Bloomberg’s solutions for China’s bond market, please visit RMB<GO> and BC<GO> on the Bloomberg Terminal.

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[1] The Bloomberg Southbound Bond Connect solution is provided to dealers in Hong Kong by Bloomberg Tradebook Hong Kong Limited.

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