Standard Chartered (China) supports first securities lending deal via QFII
04 January 2021 China
Image: Travel_man/adobe.stock.com
Standard Chartered Bank (China) has confirmed it was among the first custodians assisting a large overseas institutional investor to complete a securities lending transaction in the A-share market under the new regulatory regime.
As of November 2020, the Qualified Foreign Institutional Investors (QFII)/RMB Qualified Foreign Institutional Investors (RQFII) regime was amended to allow securities financing and short selling transactions by licenced investors.
This includes the mainboard, growth enterprise market and the Shanghai Stock Exchange Science and Technology Innovation Board (STAR Market).
Standard Chartered was among the first custodians to assist with the deal on the day the rules changed on 1 November for the Shanghai and Shenzhen markets.
The participation of QFII investors in securities lending helps expand the scale of the markets, improve the trading engagement, refine the long-short balance mechanism, and further enhance the internationalisation of China’s capital market, explains Standard Chartered.
Rick Hu, head of securities services at Standard Chartered China, says: “The latest regulatory relaxations offer more investment instruments to QFII, among which the stock borrowing and lending businesses have always been the most attractive ones that are frequently inquired by many overseas institutional investors.”
“We are pleased to have played a key role in our client’s successful completion of the first stock borrowing deal, and will continue to introduce and serve overseas institutional investors to contribute to the interconnection of domestic and foreign capital markets,” adds Hu.
Standard Chartered started its custodial business in China's capital market from as early as 1992 and became one of the first QFII custodian banks in 2003. In 2018, Standard Chartered (China) was the first and only foreign bank in China who was granted the domestic fund custody licence.
Other custodians that are now facilitating securities lending and short selling under the expanded QFII scheme include HSBC and Citibank.
As of November 2020, the Qualified Foreign Institutional Investors (QFII)/RMB Qualified Foreign Institutional Investors (RQFII) regime was amended to allow securities financing and short selling transactions by licenced investors.
This includes the mainboard, growth enterprise market and the Shanghai Stock Exchange Science and Technology Innovation Board (STAR Market).
Standard Chartered was among the first custodians to assist with the deal on the day the rules changed on 1 November for the Shanghai and Shenzhen markets.
The participation of QFII investors in securities lending helps expand the scale of the markets, improve the trading engagement, refine the long-short balance mechanism, and further enhance the internationalisation of China’s capital market, explains Standard Chartered.
Rick Hu, head of securities services at Standard Chartered China, says: “The latest regulatory relaxations offer more investment instruments to QFII, among which the stock borrowing and lending businesses have always been the most attractive ones that are frequently inquired by many overseas institutional investors.”
“We are pleased to have played a key role in our client’s successful completion of the first stock borrowing deal, and will continue to introduce and serve overseas institutional investors to contribute to the interconnection of domestic and foreign capital markets,” adds Hu.
Standard Chartered started its custodial business in China's capital market from as early as 1992 and became one of the first QFII custodian banks in 2003. In 2018, Standard Chartered (China) was the first and only foreign bank in China who was granted the domestic fund custody licence.
Other custodians that are now facilitating securities lending and short selling under the expanded QFII scheme include HSBC and Citibank.
← Previous industry article
Deutsche Bank joins ranks of custodians offering securities lending via QFII scheme
Deutsche Bank joins ranks of custodians offering securities lending via QFII scheme
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
