The People's Bank of China, China Securities Regulatory Commission and China's State Administration of Foreign Exchange issued a joint announcement supporting eligible foreign institutional investors in China’s bond market to carry out bond repurchase (repo) transactions, expanding access beyond previously permitted categories. The authorities linked the move to rising demand among foreign investors for repo-based liquidity management as their presence in the market has grown. As of end-August 2025, 1,170 foreign institutions from 80 countries and regions had entered China’s bond market, holding around CNY 4 trillion of bonds. Prior opening steps cited include allowing foreign sovereign-type institutions, offshore RMB clearing banks and offshore participating banks to conduct repo in the interbank bond market since 2015, and the 2025 launch with the Hong Kong Monetary Authority of an offshore repo arrangement using Bond Connect Northbound bonds as collateral. The operational approach is intended to better align the interbank bond repo mechanism with international market practices, including enabling transfer and re-use of the underlying bonds. The three authorities said they will continue to refine supporting arrangements and advance China’s bond market institutional opening while coordinating financial opening and security.
Central Bank of the Republic of China 2025-09-26
People's Bank of China, China Securities Regulatory Commission and China's State Administration of Foreign Exchange widen access for foreign investors to conduct onshore bond repo
The People's Bank of China, China Securities Regulatory Commission, and China's State Administration of Foreign Exchange announced expanded access for eligible foreign institutional investors to conduct bond repurchase transactions in China's bond market. This move addresses rising demand for repo-based liquidity management among foreign investors, who held approximately CNY 4 trillion in bonds as of August 2025. The authorities aim to align the interbank bond repo mechanism with international practices and will continue refining supporting arrangements to advance market opening.