Citi establishes clearing and settlement with new Beijing Stock Exchange

China’s third national stock exchange is aimed at innovation-oriented small and medium-sized enterprises (SMEs).

Citi China has established the clearing and settlement route with China Securities Depository and Clearing Corp’s (CSDCC) for the new Beijing Stock Exchange and the National Equities Exchange and Quotation (NEEQ).  

In September last year, Chinese President Xi Jinping announced plans for the creation of a new bourse in Beijing, making it the third stock exchange on the Chinese mainland after the Shanghai Stock Exchange and the Shenzhen Stock Exchange.  

The new Beijing Stock Exchange is fully owned by the Beijing-based NEEQ, an existing platform dealing in over-the-counter trading of smaller companies typically before they list on a stock exchange. It is expected that many of the top-tier companies traded on NEEQ will migrate to the Beijing Stock Exchange. 

The Beijing Stock Exchange will focus on innovation-oriented small and medium-sized enterprises (SMEs) which may have struggled to access financing compared with their larger counterparts. The new exchange will provide these SMEs with an increased pool of investor capital to support their growth ambitions. 

“Citi first came to China 1902 and our story has been one of continuous innovation and evolution in lockstep with China’s capital market developments, an example of which is this past July when Citi received final approval to launch securities investment fund custody services onshore. Our ability now to support settlement and clearing activity for the launch of the Beijing Stock Exchange reiterates our support and confidence in the China market,” said Christine Lam, chief executive officer of Citi China. 

Citi becomes one of the first international banks to set up a clearing a clearing and settlement route for the new stock exchange and become fully equipped to support QFII trading.