Bloomberg Facilitated Trades for Seven Hong Kong Market Makers on First Trading Day of Southbound Bond Connect

Shanghai, Hong Kong – Seven Hong Kong market makers completed trades on the Southbound Bond Connect using Bloomberg solutions today^[1] with more than 40 onshore investors. These solutions, based on the system connectivity between Bloomberg and CFETS, facilitated seamless trading on the Southbound Bond Connect, enabling offshore dealers to provide market-making services via the Bloomberg Terminal for onshore investors who initiate requests for quote from CFETS’ bond trading platform.

Offshore market makers in Hong Kong that made trades over Bloomberg solutions today include Bank of China (Hong Kong) Limited, Bank of Communications Co., Ltd., Hong Kong Branch, China CITIC Bank International Limited, China Construction Bank (Asia) Corporation Limited, The Hongkong and Shanghai Banking Corporation Limited, Industrial and Commercial Bank of China (Asia) Limited, and Standard Chartered Bank (Hong Kong) Limited.

“The launch of Southbound Bond Connect over Bloomberg today builds on our position as the first global trading platform connected to CFETS to offer dual access to CIBM-Direct and Bond Connect, and demonstrates strong demand from onshore investors to participate in the Hong Kong bond markets,” said Ben Macdonald, Bloomberg’s Global Head of Enterprise Products.  “We are proud of our role in facilitating global access to China’s fixed income market participants through our trading solutions, benchmark indices and data offerings.”

Sun Yu, Vice Chairman and Chief Executive of Bank of China (Hong Kong), said: “We are delighted to have built a long-term working relationship with Bloomberg and have their support in providing seamless bond trading. BOCHK has successfully conducted the first batch of trades under the Southbound Bond Connect with onshore institutional investors today, achieving full coverage of bond investment channels, products and services. As the clearing bank for RMB business and one of the largest commercial banking group in Hong Kong, BOCHK will continue to work together with Mainland and Hong Kong financial infrastructure services institutions to optimise the operation of the Southbound Bond Connect, further promoting the development of mutual access between the Mainland and Hong Kong financial markets.”

David Liao, Co-Chief Executive of The Hongkong and Shanghai Banking Corporation Limited, said: “We are extremely pleased to have successfully executed a number of client trades under the Southbound Bond Connect since it went live earlier today.  The whole Bond Connect program has been a story of continuous refinement, and its success is due in no small part to the close collaboration among market participants. It is part of a bigger story of Hong Kong’s distinctive ability to connect the economy of the Mainland and the rest of the world, and underlines the two-way benefits of working together to create a whole that is greater than the sum of its parts.”

“We look forward to supporting the data needs of participants of the Southbound Bond Connect, and the technology needs of Hong Kong market makers, accelerating the growth of Hong Kong’s burgeoning bond market. The Southbound Bond Connect will further cement Hong Kong’s status as a premier international financial center, fostering greater market participation and capital flows within the Greater Bay Area and beyond,” said Bing Li, Bloomberg’s Head of Asia-Pacific.

Through the Southbound Bond Connect program, qualified onshore investors can initiate a request for quote from CFETS’ bond trading platform to user-selected offshore dealers. 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, enabling greater efficiency without disruption to current market-making businesses.

Bloomberg is also one of the leading market 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.  This marks the first time onshore investors in China can view BVAL data on a third-party system.

Bloomberg has partnered with CFETS as a critically important technology provider since 2017 to offer solutions via connectivity with CFETS that facilitate the participation of offshore investors in China’s interbank bond market:

• Bloomberg was the first global trading platform to offer dual access to international investors under both CIBM-Direct and Bond Connect, the two most popular schemes used by offshore China investors.
• Bloomberg was also the first to offer international investors under CIBM-Direct an electronic solution, and aggregate all live streaming liquidity from dealers on CFETS.

Bloomberg offers investors comprehensive fixed income analytical tools and benchmarks, in addition to a full suite of enterprise products that facilitate the inflow of foreign investment into China’s bond market. For more details about Bloomberg’s solutions for China’s bond market, please check {RMB <GO>} on the Bloomberg Terminal.

The People’s Bank of China (PBOC) and Hong Kong Monetary Authority (HKMA) jointly announced the launch of Southbound Bond Connect on September 15. According to the PBOC, 41 mainland banks, as well as participants in the mainland’s qualified domestic institutional investor (QDII) and yuan QDII (RQDII) schemes, are eligible to participate in the new arrangement. HKMA has designated 13 financial institutions as market makers for Southbound Bond Connect.

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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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