Under the Northbound settlement link, the Central Moneymarkets Unit (CMU) has opened nominee accounts with two Mainland central securities depositories (CSDs), namely the China Central Depository & Clearing Co., Ltd (CCDC) and Shanghai Clearing House (SHCH), to settle Bond Connect transactions and hold China Interbank Bond Market (CIBM) bonds on behalf of CMU members for their overseas investor clients using Bond Connect.

Northbound Bond Connect Operating ModelClick to view original image

Northbound Trading follows Mainland China's current policy framework governing overseas participation in the CIBM and at the same time respects international norms and practices.

There is no investment quota for Northbound Trading.

Benefits for Offshore Investors Accessing CIBM Through Bond Connect

  • Using international trading and settlement practice to access CIBM.  Eligible offshore investors can trade directly through recognised offshore international trading platforms and settle through their existing global and local custodian arrangements. Bonds are held through the nominee accounts opened by CMU in Mainland with SHCH and CCDC, no onshore presence is required for investors.
  • Account opening process is streamlined and the approval turnaround time is by far the shortest among all access channels.
  • Operational efficiency is enhanced. CMU's automated operation and reporting service tailored made for Bond Connect investors make the flow of funds and information to investors more efficiently.
  • Investors have the flexibility to choose to use offshore RMB or foreign currencies for settlement.
Last revision date : 22 Jan 2024