July 29, 2021, China Financial Futures Exchange (CFFEX) held a review seminar in Beijing on best practices of CGB futures. Officials from China Securities Regulatory Commission (CSRC) and CFFEX attended the seminar.
This event of CGB Futures best practices review has drawn wide attention from the industry. A number of institutional investors actively participated in the event. After selecting the crème de la crème, 10 CGB futures application cases submitted by 10 institutional investors were picked for the final review. During the review seminar, those shortlisted 10 institutional investors presented their cases, which include CGB futures supporting bond issuance, reducing corporate financing costs, managing financial risks, improving bond market performance, and serving the opening up of the financial market. And based on their expertise, review committee at the seminar evaluated each cases from perspectives including macro policy, and raised constructive opinions and suggestions.
On the seminar, Mr. Shi Guangwei, Executive Vice President of CFFEX, pointed out that CGB futures are important tools for interest rate risk management. A well-functioning CGB futures market is of great significance in deepening financial market reform and improving the overall financial system. By far, CFFEX has successively listed 5-year, 10-year and 2-year CGB futures, covering the short, medium and long term yield. The market scale has grown steadily and its functions have become increasingly prominent. The purpose of this event is to deeply explore, recognize and promote innovative CGB futures application on risk management to serve the real economy, and build a joint force to develop the CGB futures market through collaboration and communication.
A CSRC official summarized that the CGB futures application cases of institutional investors are vivid embodiment of financial futures serving the real economy, which demonstrated that the fundamental purpose of financial futures market is to supplement the capital market and also support the national strategies. The CSRC official also expressed expectations that with the support of regulators and joint efforts of the industry, CFFEX would further enrich its CGB futures product line, improve the trading mechanism, enhance the investors base, and encourage more medium and long-term investors to participate in the CGB futures market, so as to further serve the high-quality development of the bond market. And meanwhile, it is also expected that market participants would further strengthen compliance, enhance risk control, improve capability, and lay a solid foundation for robust market operation.
Next, in line with CSRC's principle of "Four Awes" and "One Synergy", CFFEX will fully shoulder its market and political responsibilities, improve its services to institutional investors, and steadily build a healthy bond futures market going forward. By integrating the CGB futures market development into the big-picture of national strategies, serving the real economy and the capital market reform, CFFEX will strive to further serve the high-quality development of China’s bond market and national economy.
