The Zhitong Finance App learned that Bond Connect published an article on July 10 stating that Swapcom is an innovative interconnection mechanism launched in May 2023, which allows overseas investors to directly participate in the domestic interest rate derivatives market through cross-border infrastructure connections. Since its launch, the swap has been running smoothly, and the number of investors and trading volume has grown steadily. As of July 2026, the number of foreign investors in the swap has increased to 100. The trading volume in the first quarter of 2026 reached 1.78 trillion yuan, an increase of 26% over the previous year.
Mr. Wang Tong, general manager of Bond Connect, said, “Bond Connect has always regarded it as an important responsibility to promote the swapping mechanism and continue to help further open up the Chinese derivatives market to the outside world. As of July 2026, the total number of exchange and market entry agencies reached 100, which is three times that of the initial launch of the business. There are many types of participating institutions, covering various entities such as foreign sovereignty, banks, asset management, and brokerage firms. Among them, bank investors account for 70%, followed by asset management and brokerage firms. In terms of participating regions, market participants mainly come from 17 countries or regions, including Hong Kong, Asia Pacific, the United Kingdom, Europe, and the Middle East, and the coverage of market participation continues to expand.”
Wang Wei, CEO of Bank of America China, said, “Judging from the actual needs of international investors, swaps have not only expanded channels to participate in the Chinese financial market, but more importantly, provided interest rate hedging tools in line with the risk management habits of mainstream global institutions. Over the past few years, swap has continued to improve product coverage, transaction terms and market mechanisms, enabling overseas investors to manage RMB interest rate risk more efficiently and adjust risk exposure flexibly according to investment strategies. The steady increase in market participation reflects international investors' recognition of the mechanism and their continued interest in China's fixed income market. For global financial institutions, swaps have strengthened the connectivity of domestic and foreign interest rate markets, further promoted the connectivity of the RMB interest rate market with the international market, and provided more convenience for overseas investors to manage interest rate risks and participate in the Chinese fixed income market.”
Mr. Zhang Chengdong, Deputy General Manager of the Bank of China Hong Kong Global Market and Head of Trading, stated, “Swapping is the world's first derivatives market interconnection mechanism. It innovatively establishes a connection between the Shanghai Clearing House and the two central clearing houses of the Hong Kong OTC Clearing House. It uses an internationally accepted central clearing mechanism for interest rate derivatives to transfer original counterparty risks through contract conversion, and the central clearing houses of the two places uniformly carry out standardized security deposits and fund settlement. Since its launch in 2023, Swaps has continued to expand its product lineage, and overseas investors can join the Swaps mechanism in a simple and convenient form through proxy clearing banks. The swap mechanism also continues to optimize the scope of collateral for central clearing. It can already accept onshore treasury bonds and government bonds held by overseas investors through Bond Connect as collateral for initial security deposits, improving the financial efficiency of swapping investors and reducing liquidity costs. As an active clearing agency, BOCHK is deeply involved in the continuous optimization of swaps, helping customers to efficiently enter this important market and continue to promote the development process of the RMB interest rate derivatives market.”
Mr. Xiong Bowen, Managing Director of Greater China and North Asia Macro Trading at Standard Chartered Bank, stated, “Swaps have greatly broadened the channels for international investors to easily and safely invest in the Chinese bond market. With Hong Kong's mature and complete clearing infrastructure, the mechanism helps us manage interest rate risk, streamlines operations and compliance processes, and enables market participants to participate more confidently in the financial derivatives markets of the Mainland and Hong Kong. Interchange not only enhances our ability to steadily control risk, helps expand RMB fixed income investments, but also creates richer investment and financing solutions for customers. Coinciding with the third anniversary of the launch of Swapcom, the mechanism further highlights Hong Kong's unique advantages as a superhub connecting global capital with the continuing deepening financial market in mainland China, and continues to promote the internationalization of the RMB.”
In the next step, Bond Connect will continue to provide good services to help overseas investors participate more efficiently and conveniently in the Chinese derivatives market.