China policy round-up: China cuts UST holding, shorter foreign investment negative lists to launch by June, London Clearing House welcomes first Mainland member

In this round-up, China’s holdings of US treasuries reached the lowest level in two years, the Ministry of Commerce (MoC) promised to unveil foreign investment negative lists in 10 days, and Bank of China (UK) can now provide clearing services in London.

  • By Rebecca Feng
  • 21 Jun 2019
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China cut its US treasury holdings to the lowest level in almost two years. The nation’s holdings of US notes, bills and bonds declined by $7.5bn in April to $1.11tr, according to data released by the US Treasury Department on Monday.

That said, China remains the largest holder of US treasuries. Japan comes second, holding $1.064tr in April.

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China will publish shortened foreign investment negative list by the end of June, Gao Feng, a spokesperson of the MoC, said on Thursday.

The resolution to shorten the negative lists was first mentioned in the March Boao Forum by Chinese premier Li Keqiang.

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On Wednesday, BOC (UK) joined the London Clearing House’s SwapClear service as its first clearing member from a Chinese banking group.

BOC now has access to the clearing of interest rate derivatives at the London Clearing House. The bank will also offer clearing services to its client base.

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Hong Kong suspended the China extradition bill after the June 16 protest in the city. Carrie Lam, the region’s chief executive, indefinitely delayed the proposed law which allows criminals to be extradited to mainland China and other countries.

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The China Securities Regulatory Commission and its UK counterpart, the Financial Conduct Authority, issued a joint announcement on Monday to support the Shanghai-London Stock Connect scheme.

Most importantly, the statement set quotas for eastbound and westbound investments for the scheme. Eastbound trading, referring to London-listed companies issuing and listing Chinese depositary receipts on the Shanghai Stock Exchange (SSE), is subject to a Rmb250bn ($36.5bn) trading quota ceiling. Westbound trading, referring to Shanghai-listed companies issuing and listing global depositary receipts on the London Stock Exchange, has a Rmb300bn quota.

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Shanghai Stock Exchange opened a branch in London on Monday.

The main duties of the London-based branch, according to an official statement, is to promote the internationalisation of the Chinese capital markets, conduct international market research, and provide strategies for the Shanghai Stock Exchange to go global.


  • By Rebecca Feng
  • 21 Jun 2019

GlobalRMB Panda Bonds league table

Rank Arranger Share % by Volume
1 Bank of China (BOC) 21.85
2 China Merchants Securities Co 14.67
3 Industrial and Commercial Bank of China (ICBC) 14.44
4 Agricultural Bank of China (ABC) 8.89
5 China Securities 7.41

Panda Bond Database

Pricing Date Issuer Country Size Rmb (m)
1 10-Jul-19 BMW Finance N.V. Germany 3,500
2 20-Jun-19 Maybank Malaysia 2,000
3 30-May-19 Portugal Portugal 2,000
4 17-May-19 Trafigura The Netherlands 540
5 16-May-19 CITIC Pacific China 1,000

Offshore RMB Bond Top Bookrunners

Rank Bookrunner Share % by Volume
1 Standard Chartered Bank 32.50
2 Credit Agricole 6.34
2 HSBC 6.34
4 Bank of China (Hong Kong) (BOCHK) 6.22
4 Bank of Communications Hong Kong Branch (BOCOM HK) 6.22

Latest Offshore RMB Bonds

Pricing Date Issuer Country Size Rmb (m)
1 16-Jul-19 CIFI Holdings China 1,600
2 22-May-19 Agricultural Development Bank of China (ADBC) China 3,000
3 16-Apr-19 ICBC Singapore Branch China 1,000
4 10-Apr-19 Bank of China Macau Branch (BOC Macau) China 4,500
5 15-Mar-19 Bank of Communications Hong Kong Branch (BOCOM HK) China 2,500