On April 7 when China Foreign Exchange Trade System and National Interbank Funding Center (“Trade Center”) and Shanghai Clearing House officially launched the RMB standard bond forward product, ICBC completed the first three-year China Development Bank (CDB) Bond near-term contract, with overall quotation and trading volume ranking the top on the market, which played a positive role in enhancing trading activeness in the standard bond forward market and supporting market development.

The standard bond forward product is a major innovation in trading and investment tools in the bond market, with the first batch of products targeted at three-year, five-year, and ten-year CDB bonds. Unlike ordinary bond forward contracts featured by diversified forms and inconvenience for standard transactions, the standard bond forward has standardized settings on product elements such as delivery date and target bond. Market participants can directly trade under the preset contracts. Through carrying out RMB standard bond forward product transactions, commercial banks can not only enrich trading and investment tools in the bond market, but also manage bond interest rate risk.

As one of the largest RMB market makers in the interbank market, ICBC has continued to play an important role in supporting product innovation, vitalizing market offers, and providing market liquidity. In the next step, ICBC will actively push forward two-way quotations of the standard bond forward product and constantly improve pricing capability of bond derivatives to meet customers’ demand for managing bond interest rate risk. Meanwhile, the Bank will also refer to trading strategies of the bond derivatives in matured market to steadily conduct arbitrage and hedging of the standard bond forward products, further enrich trading varieties in the bond market, and meet customers’ demand for risk evasion and investment.