HKEX(HK:00388) Zhong Guo Ji Jin Bao·2025-09-22 14:03Core Viewpoint - Hong Kong Exchanges and Clearing Limited (HKEX) has introduced a new interest rate swap contract based on the one-year Loan Prime Rate (LPR1Y) under the "Northbound Swap Connect" to meet the diverse needs of overseas investors [1][2][3] Group 1: New Financial Instruments - The introduction of LPR1Y-based interest rate swaps aims to enhance the risk management tools available to overseas investors, addressing previous concerns about the lack of liquidity and risk management options in Chinese government bonds [2][3] - On the launch day, 31 domestic and foreign institutions participated, executing 53 trades with a total nominal principal amount of RMB 6.46 billion [2] Group 2: Operational Stability - Since its launch on May 15, 2023, the "Swap Connect" has been operating smoothly, becoming an important channel for overseas institutions to manage RMB interest rate risks [4] - As of August 2025, 82 overseas financial institutions from 15 countries and regions have conducted over 15,000 RMB interest rate swap transactions, totaling approximately RMB 8.15 trillion in nominal principal [4] Group 3: Future Developments - HKEX plans to continue collaborating with regulatory bodies and market participants to enrich the "Swap Connect" product offerings and improve the risk management framework [4] - The maximum term for the existing CNY Non-Deliverable Interest Rate Swap (CNY NDIRS) contracts has been extended from 5.5 years to 11 years to better assist overseas investors in managing interest rate risks [4]