Clearstream Banking and Schenzhen Securities Communication Co (SSCC) have opened a direct connectivity for fund order routing of Mainland China-domiciled funds.
The link is established under the Mainland China-Hong Kong Mutual Recognition of Funds (MRF) programme and allows Hong Kong and Chinese asset managers to distribute recognised funds in both jurisdictions.
Additionally, the link facilitates the direct processing of cross-border investment fund transactions between Mainland China, Hong Kong, and international market participants.
According to Clearstream, their customers can now send orders to Mainland China funds under the MRF scheme.
As well as this, fund orders can be routed directly to SSCC for transmission to the fund register held by China Securities Depository and CSDC.
In return, China-based asset managers are able to reach eligible Hong Kong institutional investors, Clearstream revealed.
Xue Ke, vice-general manager of SSCC, said: “Mutual recognition of funds is an important step towards the opening-up and innovation of China’s capital market in recent years.”
“It accelerates the two-way capital flow between domestic and overseas markets, and promotes the competitiveness and transformation of the asset management industry.”
“In order to meet the growing market demand of MRF, SSCC continues to work with international counterparts such as Clearstream to serve clients in Mainland China and Hong Kong, providing an electronic one-stop solution for the operations of mutual recognition of funds.”
Philippe Seyll, co-CEO of Clearstream Banking, commented: “We welcome the eligibility of the first China-domiciled funds in Vestima under the MRF programme. It is a notable step towards opening the Chinese market for investments into domestic mutual funds and towards a further internationalisation of the Renminbi.”
“The cooperation with SSCC supports our key objective to meet our customers’ increasing demand to invest in Asia and to facilitate their business in those markets.”
