1. Bond Issuance

In April, the bond market saw a total issuance of RMB6.89991 trillion. The issuance of treasury bonds, local government bonds, financial bonds, corporate credit bonds1, credit-asset-backed securities, and interbank certificates of deposit (CDs) reached RMB1.08496 trillion, RMB343.91 billion, RMB1.08135 trillion, RMB1.47005 trillion, RMB25.21 billion and RMB2.85622 trillion, respectively.

As of end-April, outstanding bonds held in custody amounted to RMB161.4 trillion, including RMB140.6 trillion in the interbank bond market and RMB20.8 trillion in the exchange-traded bond market. By bond type, treasury bonds, local government bonds, financial bonds, corporate credit bonds, credit-asset-backed securities and interbank certificates of deposit (CDs) in custody recorded an outstanding amount of RMB29.7 trillion, RMB41.5 trillion, RMB38.5 trillion, RMB32.6 trillion, RMB1.5 trillion and RMB16.5 trillion, respectively. Commercial bank over-the-counter (OTC) bonds in custody recorded an outstanding amount of RMB60.57 billion.

2. Bond Market

In April, the turnover of cash bond trading in the interbank bond market saw a year-on-year increase of 34.1 percent (a month-on-month decrease of 11.9 percent) to RMB36.0 trillion, with the daily average standing at RMB1.63768 trillion. Of the total turnover, transactions with each trade between RMB5 million and RMB50 million accounted for 48.6 percent, while those with each trade above RMB90 million made up 45.1 percent. The average value per trade was RMB45.365 million. The turnover of cash bond trading in the stock exchange bond market was RMB3.3 trillion, averaging RMB165.45 billion daily. A total of 53,000 transactions were done in the commercial bank OTC bond market, with the total turnover of RMB14.20 billion.

3. Bond Market Opening-up

As of end-April 2024, overseas institutions held RMB4.09 trillion, or 2.5 percent of the outstanding bonds in custody in China’s bond market. Specifically, their holdings in the interbank bond market amounted to RMB4.05 trillion. By bond type, overseas institutions held RMB2.22 trillion of treasury bonds, or 54.8 percent of their bond holdings in the interbank bond market, and RMB0.88 trillion of policy financial bonds, or 21.7 percent of their bond holdings in the interbank bond market.

4. Money Market

In April, interbank money market transactions increased by 2.5 percent year on year (a month-on-month decrease of 4.6 percent) to RMB147.8 trillion. Specifically, pledged repo transactions rose by 4.7 percent year on year (a month-on-month decrease of 5.0 percent) to RMB137.8 trillion; outright repo transactions went up by 47.7% percent year on year (a month-on-month increase of 7.3 percent) to RMB712.04 billion; and interbank lending transactions decreased by 23.1 percent year on year (a month-on-month increase of 2.0 percent) to RMB9.3 trillion. Repo transactions of exchange-traded standardized bonds went up by 9.4 percent year on year (a month-on-month decrease of 6.7 percent) to RMB39.1 trillion.

In April, the monthly weighted average interest rate on pledged repos stood at 1.86 percent, down by 5 bps from a month earlier, while the monthly weighted average interest rate on interbank lending was 1.87 percent, down by 1 bp from a month earlier.

5. Bill Market

In April, commercial drafts that were accepted totaled RMB3.2 trillion while those discounted amounted to RMB2.6 trillion. As of end-April, the outstanding amount of accepted commercial drafts stood at RMB17.9 trillion, and those discounted registered RMB12.6 trillion.

In April, 97,000 micro, small, and medium-sized enterprises (MSMEs) issued bills, accounting for 92.9 percent of all issuing enterprises. Bills issued by MSMEs reached RMB2.2 trillion, representing 71.1 percent of the total issuance. Of all the enterprises that discounted bills, 106,000 (96.5 percent) were MSMEs. The bills they discounted registered RMB2.0 trillion, accounting for 75.6 percent of the total amount of discounted bills.

6. Stock Market

At end-April, the Shanghai Composite Index closed at 3104.8 points, increasing by 63.6 points (2.1 percent) from a month earlier. The Shenzhen Component Index closed at 9587.1 points, increasing by 186.3 points (2.0 percent) from a month earlier. In April, the average daily turnover on the Shanghai Stock Exchange decreased by 5.1 percent month on month to RMB406.59 billion and that on the Shenzhen Stock Exchange decreased by 13.1 percent month on month to RMB506.47 billion.

7. Structure of Bond Holders in the Interbank Bond Market

As of end-April, there were 4,028 incorporated institutions in the interbank market, all of which were financial institutions. Of the incorporated institutions, 2,140 were holders of debt-financing instruments issued by non-financial institutions2 (“non-financial debt financing instruments” for short). By the size of bond holdings, the top 50 investors, mainly including public funds (asset management), large state-owned commercial banks (proprietary), and trust companies (asset management), held 51.2 percent of the total, and the top 200 investors held 83.1 percent. The biggest, smallest, average, and median numbers of holders for a non-financial debt financing instrument were 61, 1, 13 and 12, respectively, while 88 percent of non-financial debt financing instruments were held by fewer than 20 investors.

In April, based on the trading volume of non-financial debt-financing instruments by incorporated institutions, the top 50 investors conducted 63.6 percent of such transactions, mainly including securities companies (proprietary), joint stock commercial banks (proprietary) and fund companies (asset management). Transactions by the top 200 investors accounted for 91.3 percent.

(Sources: China Securities Regulatory Commission, China Central Depository & Clearing Co., Ltd., National Interbank Funding Center, Shanghai Clearing House, Shanghai Commercial Paper Exchange, Shanghai Stock Exchange, Shenzhen Stock Exchange, and Beijing Financial Assets Exchange)