The Finance Department of the Ministry of Finance and Hong Kong Monetary Authority signed Memorandum of Co-operation on Using Central Moneymarkets Unit for Issuance of Renminbi Sovereign Bonds

Sun Xiaoxia, Director-General of the Finance Department of the Ministry of Finance (MoF), and Mr Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority (HKMA), signed an "Memorandum of Co-operation on Using Central Moneymarkets Unit for Issuance of Renminbi Sovereign Bonds" today (Monday) in Hong Kong, setting the good foundation for the tendering and issue of renminbi sovereign bonds through the CMU BID, a bond tendering platform offered by the Central Moneymarkets Unit (CMU) operated by the HKMA. It manifests a deepening of financial co-operation between the Mainland and Hong Kong, and will widen the channel and enhance the methodology and environment for the issuance of renminbi sovereign bonds.

The MoF plans to issue renminbi sovereign bonds of RMB 5 billion yuan to institutional investors through the CMU BID, comprising three-year bonds of RMB 2 billion yuan, five-year bonds of RMB 2 billion yuan and 10-year bonds of RMB 1 billion yuan. The MoF has appointed the Bank of Communications Co. Ltd. Hong Kong Branch to be the issuing and lodging agent responsible for matters relating to the tendering of the renminbi sovereign bonds. Details of the tendering exercise will be announced shortly.

Mr Norman Chan, Chief Executive of the HKMA, said, "The CMU tendering platform has served us well in the past 17 years. It is where the primary issues of the Exchange Fund Bills and Notes and the Government Bonds are tendered. It helps increase market transparency and facilitates price discovery. The signing of the Memorandum by the MoF and the HKMA on using the CMU to conduct tendering for the issuance of the renminbi sovereign bonds marks a milestone of the strengthening of financial co-operation between the Mainland and Hong Kong."

The CMU is operated by the HKMA. It serves as a platform for tendering, clearing and settlement of bonds. The tendering of renminbi sovereign bonds through the CMU is the system's first tendering of bonds denominated in renminbi.

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Hong Kong Monetary Authority
22 November 2010

Sun Xiaoxia, Director-General of the Finance Department of the Ministry of Finance and Eddie Yue, Deputy Chief Executive of the HKMA sign the "Memorandum of Co-operation on Using Central Moneymarkets Unit for Issuance of Renminbi Sovereign Bonds".