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I. Business Overview
In accordance with the Joint Announcement of the People’s Bank of China and the Hong Kong Monetary Authority and the Notice of the People’s Bank of China on the Implementation of Southbound Cooperation on the Interconnectivity of the Bond Markets of the Chinese Mainland and Hong Kong, the southbound cooperation between Hong Kong and mainland bond markets in terms of interconnectivity (hereinafter referred to as “Southbound Bond Connect”) means that domestic investors invest in bonds traded and circulated in the Hong Kong bond market through the mechanism arrangement of connectivity between the mainland and Hong Kong related basic service institutions in bond trading, custody, settlement and other aspects. Domestic investors who meet the requirements of the PBC can carry out bond investment through the “Southbound Bond Connect”. The underlying bonds are all securities issued overseas and traded and circulated in the Hong Kong bond market.
II. Target Customers
The “Southbound Bond Connect” investors from Chinese mainland are tentatively designated as 41 banking financial institutions (excluding non-banking financial institutions and rural financial institutions) among the primary dealers of the PBC’s open market business in 2020. Qualified domestic institutional investor (QDII) and RMB qualified domestic institutional investor (RQDII) can also invest in overseas bonds through the “Southbound Bond Connect”. In addition, securities brokers approved by the PBC can also use their own funds to carry out “Southbound Bond Connect” investment.
III. Scope of Services
1.Account opening: Open domestic and overseas custody accounts;
2.Asset custody: Provide asset custody service for customers;
3.Settlement of transaction: Complete the delivery and clearing of overseas securities for customers;
4.Accounting: Record investment activities in the account books;
5.Asset valuation: Valuate the assets invested by customers;
6.Company information: Provide the information about securities holdings and financial market news;
7.Investment supervision: Supervise investment activities according to customers’ portfolios and regulatory requirements;
8.Foreign exchange conversion: Currency conversion, and foreign exchange settlement and sales;
9.Receipt of income: Track equity income on a real-time basis, and ensure that it can be timely posted to accounts;
10.Reporting service: Provide customers with reports on investment and clearing on a regular basis;
11.Record keeping: Properly keep the records on investment and fund inflows/outflows and other materials;
12.Other services: Other services required by regulatory authorities.
IV. Service Advantages
As the largest custodian bank in China, ICBC has maintained its first position in the market for 25 consecutive years in terms of market share of asset custody business.
ICBC is fully and deeply involved in the “Southbound Bond Connect” program. As one of the first “Southbound Bond Connect” custody and clearing banks from Chinese mainland, ICBC has a precise grasp of the policy and can provide customers with integrated cross-border custody services for domestic and overseas institutions through its rich experience in cross-border custody services and professional and efficient team.
V. Business Flow
VI. Contact Information
If you would like to apply for any service, please contact the Global Asset Custody Division of Asset Custody Department of ICBC:
Contact: Qiao Hanruo
Tel.: (8610) 81013751
E-MAIL: hanruo.qiao@icbc.com.cn
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