LCH enables use of offshore CGBs as collateral
08 July 2026 China, UK
Image: Parilov/stock.adobe.com
LCH has announced that it will now accept offshore renminbi-denominated Chinese government bonds (CGBs) as eligible non-cash collateral.
The acceptance of offshore renminbi-denominated CGBs aims to support a more efficient use of balance sheets and liquidity by allowing firms to post high-quality local currency assets.
Under the new structure, offshore Renminbi-denominated CGBs will be accepted on a bilateral basis, with settlement through Euroclear Bank.
The news follows an announcement from LCH in May 2025 in which the clearing house began accepting CGBs denominated in euro and US dollar.
Susi de Verdelon, CEO, LCH, states: 鈥淓xpanding our collateral eligibility framework to include offshore renminbi-denominated Chinese government bonds is an important step in the evolution of our offering for global members and their customers.
鈥淲e look forward to continuing to evolve our capabilities to support them as their participation in central clearing grows.鈥�
Mr Funing Song, general manager of Financial Markets, Bank of China, comments: 鈥淐hina's bond market has grown rapidly, with increased depth, enhanced liquidity, and strong international recognition.
鈥淭his provides a solid foundation for the further global deployment of renminbi-denominated assets, offering diversity and relatively stable options that support effective risk management, enable sustainable long-term returns, and contribute to global financial stability.鈥�
China鈥檚 bond market, the second highest in the world at US$28 trillion, accounts for 15鈥�20 per cent of the entire global bond market, and continues to expand its accessibility to international investors.
Cheuk Wong, head of Macro Trading, Asia, and head of Markets and Securities Services, Hong Kong, HSBC, adds: 鈥淲e鈥檙e鈥痯roud to be among the first clearing brokers to support offshore renminbi-denominated Chinese government bonds as collateral at LCH.
鈥淭his is an important step鈥痠n strengthening the cleared derivatives market and supporting the continued鈥痠nternationalisation鈥痮f renminbi markets.鈥�
The acceptance of offshore renminbi-denominated CGBs aims to support a more efficient use of balance sheets and liquidity by allowing firms to post high-quality local currency assets.
Under the new structure, offshore Renminbi-denominated CGBs will be accepted on a bilateral basis, with settlement through Euroclear Bank.
The news follows an announcement from LCH in May 2025 in which the clearing house began accepting CGBs denominated in euro and US dollar.
Susi de Verdelon, CEO, LCH, states: 鈥淓xpanding our collateral eligibility framework to include offshore renminbi-denominated Chinese government bonds is an important step in the evolution of our offering for global members and their customers.
鈥淲e look forward to continuing to evolve our capabilities to support them as their participation in central clearing grows.鈥�
Mr Funing Song, general manager of Financial Markets, Bank of China, comments: 鈥淐hina's bond market has grown rapidly, with increased depth, enhanced liquidity, and strong international recognition.
鈥淭his provides a solid foundation for the further global deployment of renminbi-denominated assets, offering diversity and relatively stable options that support effective risk management, enable sustainable long-term returns, and contribute to global financial stability.鈥�
China鈥檚 bond market, the second highest in the world at US$28 trillion, accounts for 15鈥�20 per cent of the entire global bond market, and continues to expand its accessibility to international investors.
Cheuk Wong, head of Macro Trading, Asia, and head of Markets and Securities Services, Hong Kong, HSBC, adds: 鈥淲e鈥檙e鈥痯roud to be among the first clearing brokers to support offshore renminbi-denominated Chinese government bonds as collateral at LCH.
鈥淭his is an important step鈥痠n strengthening the cleared derivatives market and supporting the continued鈥痠nternationalisation鈥痮f renminbi markets.鈥�
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