Hong Kong Exchanges and Clearing Limited (HKEX) announced today that it welcomes the joint news release by the People’s Bank of China (PBOC), Hong Kong Securities and Futures Commission (SFC), and Hong Kong Monetary Authority on the launch of Swap Connect, a new mutual access program between Hong Kong and Mainland China’s interbank interest rate swap markets.
Scheduled for launch on May 15, 2023, Swap Connect will initially start with a Northbound channel, granting Hong Kong and international investors access to Mainland China’s interbank financial derivatives market.
This connection will be facilitated through financial infrastructure institutions in the Hong Kong and Mainland China markets.
HKEX, through its clearing subsidiary OTC Clear, has collaborated with China Foreign Exchange Trade System (CFETS) and Shanghai Clearing House (SHCH) to develop the infrastructure for Swap Connect and ensure the program’s smooth delivery and operation.
HKEX Chief Executive Officer, Nicolas Aguzin, stated, “Swap Connect is the latest chapter in our Connect story. As the world’s first derivatives mutual market access program, it will help forge stronger connectivity between Hong Kong and Mainland’s capital markets, further supporting their mutual development and strengthening Hong Kong’s role as an international financial center. We look forward to working with our Mainland partners and all our regional and international market participants to ensure the successful rollout of Swap Connect, as we connect China and the world.”
Under Swap Connect, CFETS and PBOC-recognized overseas electronic trading platforms will jointly provide trading services for Hong Kong and international investors. The program will initially offer access to interest rate swaps, which will be priced, settled, and cleared in Renminbi.
OTC Clear and SHCH will jointly provide clearing and settlement services through a central counterparties link. OTC Clear will deliver central clearing services for Hong Kong and international investors, while SHCH will offer central clearing services for investors in Mainland China.
OTC Clear is an SFC-recognized clearing house and an internationally-recognized qualifying central counterparty providing clearing and settlement services for OTC derivative transactions.
HKEX is a publicly-traded company (HKEX Stock Code:388) and one of the world’s leading global exchange groups, offering a wide range of equity, derivative, commodity, fixed income, and other financial markets, products, and services, including the London Metal Exchange.
As a superconnector and gateway between East and West, HKEX promotes the two-way flow of capital, ideas, and dialogue between China and the rest of the world through its pioneering Connect schemes, diversified product ecosystem, and deep, liquid, and international markets. – BusinessNewsAsia.com