China Mulls Doubling Southbound Bond Connect to $139 Billion
Any such move would allow onshore firms to ramp up their exposure to international bonds that are tradeable through Hong Kong’s stock exchange.
Photographer: Justin Chin/BloombergChina is considering doubling an investment channel local investors use to buy bonds overseas, according to people familiar with the matter, a major step in its efforts to loosen restrictions on financial flows.
Regulators in the country have held early talks about expanding the so-called Southbound Bond Connect program to as much as 1 trillion yuan ($139 billion), said the people, who asked not to be identified because the details are private. The expansion would be through an up to 500 billion yuan annual quota to non-bank financial institutions, which are currently left out of the trading link.