Clearing house part of global hub goal | Shanghai Daily

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November 30, 2009

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Clearing house part of global hub goal

CHINA set up its first interbank clearing house in Shanghai on Saturday in a major step for the city to improve its financial market with better infrastructure and to boost innovation in currency and bond trading as it races ahead toward its goal of a global financial hub.

The Shanghai Clearing House was set up with a registered capital of 300 million yuan (US$43.92 million) by four central bank affiliates - China Foreign Exchange Trading System, China Government Securities Depository Trust & Clearing Co, China Banknote Printing and Minting Co and China Gold Coin Co.

"The clearing house will help improve clearing efficiency, reduce clearing costs and provide technical support for innovations in financial products," said Zhou Xiaochuan, governor of the People's Bank of China, at the opening ceremony in Shanghai on Saturday.

China's interbank market is open to institutions including banks, securities firms, and asset management companies which trade currency derivatives, bonds and commercial bills among other financial instruments.

The clearing house serves to clear financial derivatives traded in the market, cuts counterparty risks, increases regulation efficiency and boosts market confidence.

Shanghai Mayor Han Zheng said the clearing house will further enhance the city's influence in China's financial industry. The State Council has crafted guidelines to build Shanghai, home to China's foreign exchange, gold and interbank markets as well as its major stock exchange and futures bourse, into a global financial hub by 2020.




 

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