Definition of Instrument
Pledged repo is a type of short-term financing business where bonds are used by both trading parties as a pledge of rights. It refers to a financing act in which borrower (positive repo party), pledges bonds to lender (reverse repo party) for funds, and at the same time two parties agree upon that when at a future date positive repo party returns the amount of funds calculated at the specified repo rate to the reverse repo party, the reverse repo party shall lift the pledged rights on the pledged bonds.
The terms of pledged repo range from 1 day to 365 days. Through the trading system, the trading volume and price of pledged repo is publicly released as a total of 11 terms including 1-day, 7-day, 14-day, 21-day, 1-month, 2-month, 3-month, 4-month, 6-month, 9-month and 1-year.
T+0: Beijing time 9:00-12:00 am, 1:30-4:50 pm,
T+1: Beijing time 9:00-12:00 am, 1:30-5:00 pm,
excluding Chinese statutory holidays.
Commercial banks and its authorized branches, rural credit cooperatives, urban credit cooperatives and other deposit-taking financial institutions, insurance companies, securities companies, fund management companies and their managed funds, portfolios, insurance products, financial companies and other non-bank financial institutions which all have bond trading qualification, and foreign-funded financial institutions which conduct RMB business, can all enter into the bond market for transaction.
Method of Clearing & Settlement
The two trading parties, at the specified date, shall handle gross settlement of funds at their own risk in accordance with deal sheet. Depository bond settlement is carried out through the China Central Depository & Clearing Co., Ltd, while funds settlement is conducted through the China National Automatic Payment System of PBC. Three types of settlement, namely "payment after delivery ", " delivery after payment " and "DVP", are available.
- Guide on Registration of Overseas Investors for Northbound Trading in Bond Connect
- Interim Measures for the Administration of Mutual Bond Market Access between Mainland China and Hong Kong SAR
- User Operation Manual of the Agent Trading System (Version for Overseas Institutional Investors)
- Fee Schedule