The China Government Depository Trust and Clearing Co. Ltd., the Asia Securities Industry and Financial Markets Association, and the Securities Industry and Financial Markets Association announced that they have signed a memorandum of understanding in which the three organizations agree to work together to further the development of the bond market in China.

Specifically, ASIFMA and SIFMA and their respective memberships will assist CDC in its efforts to adopt international best practices in China in the confirmation, matching, clearance and settlement of fixed income trades and all three parties will seek to maximize opportunities to enhance communications and connectivity between each others respective memberships. Additionally, each organization will work with government representatives to promote dialogue and to share knowledge of different aspects involved in developing a local bond market.

The three groups also plan to share market research and hold forums, seminars and other educational programs that will develop professional standards for and begin the process of certifying employees of each organization.

“We are delighted to announce that we’ve formed this cooperative partnership,” said Micah Green, co-CEO of the SIFMA. “By sharing our respective knowledge of local and global bond markets, we believe we can successfully help establish an efficient Chinese bond market that provides issuers and investors with new opportunities and promotes communication, coordination and interaction between global market participants and policymakers on capital markets development issues.”

“We believe this partnership offers several opportunities to leverage the knowledge of both organizations to help create more open domestic capital markets in China and, in turn, to promote investments that will support continued economic growth in this and other Asian countries,” said Zhang Yuan, chairman of the CDC. “We look forward to working with ASIFMA and SIFMA to construct the building blocks necessary to form a deep and liquid bond market in China.”

“Working collaboratively with the CDC on issues of common concern is of great importance to ASIFMA as our members hope to become much more active in China’s domestic bond market in the coming years” said Eric Foster, ASIFMA’s executive director. “We, therefore welcome this partnership with CDC and SIFMA as we ramp up the activities of our new association in China.”

The CDC is the central depository system for Chinese bond market, established in 1996. The ASIFMA is a new independent Hong Kong-based trade association that seeks to enhance the size, liquidity, integrity and transparency of local and regional over-the-counter markets in fixed income securities and other financial instruments in Asia.