HKEX Plans to Accept Chinese Bonds as Noncash Collateral in November
Eligible securities include Chinese government bonds, policy financial bonds held through Bond Connect’s Northbound Trading Link and overseas-issued Ministry of Finance bonds.
Hong Kong Exchanges and Clearing Limited plans for its wholly owned subsidiaries, HKFE Clearing Corporation Limited and The SEHK Options Clearing House Limited, to accept eligible Chinese bonds as noncash collateral from November 2026, subject to regulatory approval.
The eligible securities will include Chinese government bonds and policy financial bonds held through Bond Connect’s Northbound Trading Link. Overseas-issued bonds of the Ministry of Finance of the People’s Republic of China will also qualify.
The change applies to Hong Kong’s derivatives clearing operations. The bonds may be used to meet clearing-house margin requirements.
Using the bonds as collateral is intended to provide market participants with more flexibility in collateral management and improve capital efficiency.
The initiative also supports Hong Kong’s fixed-income and renminbi ecosystem by expanding the use of Chinese government bonds in the market.
The revised collateral rules remain subject to regulatory approval.
