RMB Liquidity Facility and Primary Liquidity Providers

The RMB Liquidity Facility was introduced in June 2012 to address potential short-term liquidity tightness in the offshore RMB market.  In the light of experience in operating the facility and developments in the offshore RMB market, the HKMA has made various refinements to the facility over the years.

Banks are welcome to use the RMB Liquidity Facility to meet short-term funding needs. Currently, under the RMB Liquidity Facility, banks may obtain from the HKMA:

• overnight RMB funds available on the same day;
• 1-day RMB funds available on the next day;
• 1-week RMB funds available on the next day; and
• intraday RMB funds.

In October 2014, the HKMA introduced the Primary Liquidity Providers (PLP) scheme. Nine banks were designated as the PLPs which pledged to expand their market-making activities in Hong Kong for various offshore RMB instruments, and use the Hong Kong platform in promoting their global offshore RMB business.  In return, the HKMA provides a dedicated repo facility of RMB2 billion to each of the PLPs so as to facilitate their liquidity management when carrying out more market-making and other business activities in the offshore RMB market. The PLPs can obtain intraday or overnight RMB funds from the HKMA under the repo facility, which are subject to the same terms and conditions as those of the RMB Liquidity Facility.