ICBC was officially approved by China Securities Depository and Clearing Corporation Limited a few days ago to be a settlement bank for the "Southbound" trading business, becoming the first among its peers approved to engage in cross-border fund settlement and currency exchange for the business.

The Bank has worked out a package service solution for the "Southbound" trading business comprising cross-border settlement, RMB-HKD exchange and settlement account overdraft, in a bid to provide premium and highly-efficient settlement and banking services for the "Southbound" trading business through cooperation between its Head Office, Shanghai Branch and ICBC (Asia) (its wholly-owned subsidiary based in Hong Kong).

According to an ICBC official, back in 1990 when the Shanghai Stock Exchange was just founded, the Bank's Shanghai Branch became the first clearing bank designated by the bourse, and established an exclusive "680 securities settlement desk", which became the only window dedicated to securities fund settlements in China back then, marking the establishment of the earliest securities fund settlement system in the country. In recent years, by leveraging its advantages in terms of asset size, settlement network, outlets and system technology, ICBC has actively involved itself in the innovation and development of the Chinese capital market, amassed rich expertise and experience in the trading and clearing of securities, futures and gold, built an unrivalled business edge, and become the biggest clearing bank in the domestic capital market through a series of innovation with the banking-securities industry cooperation system including bank-securities link, bank-securities transfer, third-party depository, bank-futures transfer, and currency conversion for B shares. In the meantime, the Bank has also established sound business and product systems for fund transfer, clearing, custody and trading which cover local and foreign currencies, securities, futures, gold and derivatives, providing strong support to the innovation and development of China's capital market.

The "Southbound" trading business means that investors authorize securities companies in Mainland China to apply to the Hong Kong Stock Exchange for trading in the specified stocks listed on it via the securities trading service company established by the Shanghai Stock Exchange. As part of China's initiative to open up its capital market, the business is conducive to strengthening the ties of capital markets between Mainland China and Hong Kong, facilitating the two-way opening up of capital markets, broaden the investment channels of investors, and boosting the comprehensive strength of the Chinese capital market. It is also of positive significance to promoting the internationalization of RMB, and consolidating the position of Shanghai and Hong Kong as two major financial hubs.