Finance Ministry Says New Custody Rules Won’t Apply to Government Bonds
New custody regulations that make it easier for overseas investors to trade bonds on the Chinese mainland won’t apply to one of the biggest and most liquid segments of the market — Chinese government bonds (CGBs) — the Ministry of Finance (MOF), which issues the debt, said last week.
The requirements are contained in a broader set of regulations drawn up by the People’s Bank of China, the China Securities Regulatory Commission (CSRC) and the State Administration of Foreign Exchange that are due to go into effect on June 30. They give the go-ahead for what’s known as a multi-tier custody system, which is a simpler, more convenient and more streamlined way for offshore investors to trade bonds rather than the current single-tier system that is more costly and cumbersome.
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