Hongkong and Shanghai Banking Corporation says it’s become the first global custodian bank to execute a Qualified Foreign Investor (QFI) trade on China’s third and newest bourse.
The UK lender says it facilitated trading of the Samsung RMB Qualified Foreign Institutional Investor (RQFII) trust on the two-month-old Beijing Stock Exchange for South Korean broker dealer Samsung Securities Co. It did not say when the trade was executed.
The QFI scheme allows foreign institutional investors to invest in China’s capital markets, and to invest renminbi raised offshore in onshore assets.
“This first trade emphasises our commitment to be the go-to bank for QFIs in China. Our swift response to Beijing Stock Exchange’s establishment allows our clients to access the new stock exchange in China once they wish to,” Suvir Loomba, HSBC’s global head of direct custody and clearing, says in a statement on January 5.
QFI is a combination of China’s 20-year-old Qualified Foreign Institutional Investor (QFII) scheme and the 11-year-old RQFII scheme. Beijing merged them 14 months ago to streamline the approval process.
The Chinese government opened the Beijing Stock Exchange on November 15 to help small and medium-sized enterprises to raise financing. China’s two other more established bourses are in Shanghai and Shenzhen.
HSBC says it now provides QFI custody services to 248 international institutions, or 37.4% of the 663 QFI licence holders in China.
“We expect more foreign investors to access Beijing Stock Exchange to position in high-quality and innovation-oriented small and medium-sized enterprises in boosting strategic emerging and high-tech industries,” Loomba says.
London-based HSBC had US$2.96 trillion of assets globally as of September 2021.
