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Banque de Luxembourg picks Citi for Shanghai Connect access

17 January 2017

The Shanghai-Hong Kong Stock Connect program was created in 2014.

Read more: Hong Kong China A-Shares

Citi has been appointed by Banque de Luxembourg to provide access to Shanghai-Hong Kong Stock Connect, the cross-boundary investment channel that connects the Shanghai Stock Exchange and the Hong Kong Stock Exchange.

The firm has also been picked to provide custody services for A-Shares, renminbi-denominated shares of companies traded in Shanghai or Shenzhen, acquired through the link.

The move allows Banque de Luxembourg’s investor clients to benefit from Citi’s "SPSA+" solution which offers delivery versus payment (DVP) settlement with multiple brokers.

The tool allows both securities and cash to be settled simultaneously on T+0 and also facilitates the post-trade process and therefore helps investors reduce the risk of fail trades and potential buy-in claims from their brokers.

The Shanghai-Hong Kong Stock Connect program was created in 2014. A similar model, linking Shenzhen and Hong Kong kicked off at the end of 2016. 

"A scalable, automated and efficient solution for Stock Connect will become increasingly more important as volumes increase due to the inclusion of Shenzhen Connect and the eventual inclusion of A-shares to global indices," said Cindy Chen, Hong Kong Head of Securities Services at Citi.

Fernand Reiners, member of the executive committee at Banque de Luxembourg, added: "This service is ideally positioned for our clients’ needs as it meets all of their requirements in terms of flexibility, operational efficiency and transparency."  

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