Shanghai Clearing House targets global growth with expanded offshore yuan push

SHCH will broaden its clearing services across offshore yuan bonds, interest rates and foreign exchange products

As part of this push, SHCH will broaden its clearing services for offshore yuan bonds, interest rates and foreign exchange products to help foreign investors hedge risk.

“We will further enrich the supply of yuan central counterparty clearing products, expanding categories into bonds, interest rates, and foreign exchange to provide foreign investors with rich risk-hedging tools for overseas yuan assets, reinforcing our clearing dominance over yuan products,” Ma wrote in the article published on the social media account of China Finance magazine last week.

“We should study and formulate dedicated regulations or rules to unify the standardisation and overall supervision of central counterparty clearing, while exploring liquidity risk constraint and support facilities to stabilise market expectations,” said Ma, former deputy chief of the People’s Bank of China’s financial market department.

The move comes as Shanghai released an action plan to expand offshore business, including bond issuance in pilot free-trade zone and forex trading, amid the city’s efforts to become an international financial centre.