The Hong Kong Stock Exchange plans to launch its first offshore RMB bond index this year, aiming to target the world's largest dim sum bond market.
The Hong Kong Stock Exchange is considering launching its first-ever bond index by the end of 2026 to track the performance of offshore RMB-denominated bonds. This move aims to boost trading activity in the world’s largest offshore RMB market and provide a benchmark for related ETF products.
On Thursday, Bloomberg, citing sources familiar with the matter, reported that the index is expected to track dim sum bonds with an issuance size of no less than RMB 1 billion, and the underlying securities must be listed on the Hong Kong Stock Exchange and use its infrastructure.
A spokesperson for the Hong Kong Stock Exchange (HKEX) stated that they look forward to sharing more details about the first bond index in due course to support the internationalization of the RMB and the continued development of Hong Kong's multi-asset ecosystem. Hong Kong Chief Executive John Lee also explicitly mentioned in his Policy Address yesterday that the HKEX offshore RMB bond index will serve as a "market trend reference and a relevant index for exchange-traded funds."
This move comes at a time of strong momentum in the dim sum bond market. According to data compiled by Bloomberg, sovereign and corporate issuers have issued a total of RMB 876 billion in offshore RMB bonds so far this year, a 34% year-on-year increase and a record high for the same period. Meanwhile, Chinese authorities are continuing to strengthen Hong Kong's position as an offshore RMB hub, and discussions on de-dollarization triggered by geopolitical tensions have also provided additional support for the attractiveness of RMB assets.
Index Design: Clear entry thresholds, infrastructure linked to the Hong Kong Stock Exchange
According to sources, the proposed offshore RMB bond index will set clear inclusion thresholds: the issuance size of the underlying bonds must reach RMB 1 billion (approximately US$149 million) or more, and they must be listed on the Hong Kong Stock Exchange and use its supporting infrastructure.
The above design aims to select bond types with high liquidity, while deeply integrating the index ecosystem with the Hong Kong Stock Exchange platform . This will help guide issuers to choose Hong Kong as the listing venue for Dim Sum bonds, further strengthening Hong Kong's infrastructure advantages in the offshore RMB bond market.
In response to a request for comment, a spokesperson for the Hong Kong Stock Exchange (HKEX) said, "We look forward to sharing more details about HKEX's first bond index in due course to support the internationalization of the RMB and the continued development of Hong Kong's multi-asset ecosystem."
Policy endorsement: Authorities take multiple measures to consolidate the offshore RMB hub status
This bond index plan has received explicit endorsement from Hong Kong's top leadership. In his policy address, John Lee specifically mentioned the Hong Kong Stock Exchange's offshore RMB bond index, positioning it as a market trend reference tool and an ETF-related index, indicating that the index has been incorporated into Hong Kong's overall policy framework for strengthening its status as an offshore RMB center.
At a broader policy level, in July of this year, regulators expanded the scale of the "Southbound Bond Connect" program, allowing mainland institutional investors to purchase offshore bonds through Hong Kong. The annual quota was increased from RMB 500 billion to RMB 800 billion, an increase of 60%.
At the same time, geopolitical tensions such as the Iran war have raised questions about the status of the US dollar, and investors' interest in RMB assets has continued to rise, providing a favorable external environment for the aforementioned policy measures.
Market Background: Dim Sum Bond Issuance Sets Record for the Same Period
The introduction of the bond index plan coincides with the Dim Sum bond market entering a phase of rapid expansion. From January 1 to September 16 this year, sovereign and corporate issuers issued a total of RMB 876 billion in offshore RMB bonds, a 34% increase compared to the same period last year, setting a new record for this statistical period.
The rapid increase in issuance reflects both issuers' growing reliance on Hong Kong's offshore RMB financing channels and the rising demand from global investors for RMB-denominated assets. Once the Hong Kong Stock Exchange bond index is officially launched, the market will have a standardized performance benchmark, which is expected to further catalyze the development of passive investment products and attract more institutional funds into the Dim Sum bond market.
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