The Ministry of Finance of the People’s Republic of China (MOF) and Hong Kong Exchanges and Clearing Limited (HKEx) signed a Memorandum of Understanding (MOU) today (Friday) on the listing and trading of RMB-denominated sovereign bonds in Hong Kong.
The MOU was signed by Sun Xiaoxia, Director-General of the MOF’s Finance Department and HKEx Chief Executive Charles Li. The signing was witnessed by HKEx Chairman Chow Chung Kong, Director-General of the Economic Affairs Department of the Central People’s Government Liaison Office in the Hong Kong Special Administrative Region Wang Bingxin, Hong Kong’s Under Secretary for Financial Services and the Treasury Julia Leung, Deputy Chief Executive of the Hong Kong Monetary Authority Peter Pang as well as senior representatives of the underwriting banks for the listing of MOF bonds.
After the signing of the MOU, RMB-denominated sovereign bonds issued by the MOF may list and trade on HKEx. This comes after the MOF announced last week that it plans to issue a batch of RMB23 billion in sovereign bonds, which will be the first batch to be listed on HKEx’s securities market.
Speaking at the signing ceremony, Sun said: “The MOF continues to issue RMB-denominated sovereign bonds in Hong Kong this year and has steadily increased the size of the issuance as a way to show the Central Government’s strong support for the economic development of Hong Kong. The issuance of RMB-denominated sovereign bonds and the listing of the bonds on Hong Kong’s securities market will strengthen financial cooperation between the Mainland and Hong Kong, increase the depth and breadth of the city’s bond market, and help the city to further enhance its status as an international financial centre and an offshore RMB centre.”
“Expanding into products related to fixed income, currency and commodities is a key aspect of our current strategy. Therefore, the listing of RMB-denominated sovereign bonds is an important step for us,” said Li.