Four New Registered Trustees Announced for China’s Interbank Bond Market

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China has just seen the release of new list of interbank bond market trustees who have completed filing with domestic authorities.

China’s National Association of Financial Market Institutional Investors (NAFMII) announced last week that four new interbank bond market trustees have completed registration procedures, including Everbright Securities, Zhongrong Trust, Yingda Trust and Orient Capital.

China’s interbank market is currently host to 67 institutions who have completed filing for trusteeship operations, encompassing banks, brokerages, trust companies, financial asset managers and law firms.

In China trustees are specialist organisations entrusted with protecting the interests of bond holders, and representing them during collective actions in the case of defaults or other adverse events.

Their main responsibilities include managing and disposing of collateral, representing bondholders during debt restructurings, applying for asset preservation, filing lawsuits and mediation applications and participating in bankruptcy proceedings.

The interbank market trusteeship system was announced at the end of 2019, with the authorities providing a transitional period during which market participants could engage in registration and filing.

While comprehensive implementation of the trustee system was originally scheduled for 1 July, NAFMII has since delayed this date due to the impacts of the COVID-19 pandemic.

The interbank bond market has been a key focal area for efforts by Chinese authorities to drive financial opening, with the number of foreign institutional investors more than doubling in 2019.

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