On December 12th, the central bond lending business was officially launched on CIBMTS. On the first day of the business’s launch, Industrial Bank, as one of the first participating institutions in the central bond lending business, actively participated and completed multiple transactions, helping to further improve the bond lending trading mechanism.
The central bond lending business is a new trading mode introduced based on the existing inquiry and anonymous click trading methods in the interbank bond lending market. It is provided with trading services by the National Interbank Funding Center, and offers centralized clearing, settlement and delivery, ongoing management and performance guarantee services by the Shanghai Clearing House. The goal of this mechanism is to meet the bond settlement needs of business participants and establish a risk prevention support system aimed at improving the success rate of bond settlement.
“The introduction of central bond lending business can significantly improve the success rate of bond trading settlement, reduce trading counterparty search costs, attract more institutions to participate in the bond lending business, and play a positive role in further expanding the scale of China’s bond market business,” said the head of the Funds Operations Center at Industrial Bank.
It is reported that in February 2022, the People’s Bank of China issued the “Measures for the Administration of Bond Lending Business in the Interbank Bond Market”, which explicitly stated that when the amount of bonds to be paid on the settlement date is insufficient, bond repurchase can be achieved through centralized borrowing and lending. In December 2023, the National Interbank Funding Center released the “National Interbank Loans Centre, Interbank Bond Transactions Rules”, further clarifying the definition of centralized borrowing and lending business, promoting the continuous maturity of the bond borrowing and lending business model, and providing institutional safeguards for the launch of central bond borrowing and lending operations.
As a pioneer in the National Interbank Bond Market, Industrial Bank has always prioritized serving the real economy, focusing on building itself into a “comprehensive operator” and “comprehensive service provider” in the financial market. It has steadily promoted the continuous development of bond borrowing and lending business, providing comprehensive financial market service solutions for various customer groups, and contributing to the high-quality development of the Chinese bond market.