Group 1 - The article discusses the importance of bond repurchase agreements in financial markets, highlighting their role in short-term financing, liquidity management, and monetary policy transmission, which significantly promotes the development of the bond market [1] - It analyzes the similarities and differences in bond repurchase markets across various regions, including China, the United States, Europe, Japan, Australia, and some emerging markets, to reveal common and unique characteristics of the global bond repurchase market [1] Group 2 - Bond repurchase agreements are defined as transactions where one party sells bonds to another with an agreement to repurchase them at a later date for a predetermined price [2] - The article categorizes bond repurchase agreements into several types, including bilateral and tri-party repos, as well as pledge-style and buyout repos, based on the number of participants and the transfer of ownership [3][4] Group 3 - In the United States, the bond repurchase market is primarily driven by hedge funds, commercial banks, money market funds, pension funds, and insurance companies, with government bonds being the most common collateral [9] - The U.S. market predominantly employs buyout repos, with classic repos being the most common type, and tri-party repos accounting for approximately 65% of the market [9][10] Group 4 - The European bond repurchase market is characterized by commercial banks as the largest participants, with government bonds being the primary type of collateral, accounting for over 80% [11] - Similar to the U.S., Europe also primarily uses buyout repos, with classic repos being the dominant form, while tri-party repos make up about 10% of the market [11][12] Group 5 - In Japan, the bond repurchase market is mainly composed of trust banks and securities companies, with government bonds dominating the collateral, representing over 80% [13][14] - The market has seen a rapid increase in buyout repos, which now account for approximately 98% of transactions, primarily using classic repo structures [14] Group 6 - The Australian bond repurchase market is primarily composed of large banks and registered financial companies, with government bonds being the main type of collateral [15][16] - The market predominantly utilizes buyout repos, with classic repos being the most common, while tri-party repos are relatively rare, accounting for only 5% [16] Group 7 - The article compares the bond repurchase markets in emerging markets, noting that countries like South Korea, Indonesia, and Malaysia primarily use buyout repos, with varying degrees of tri-party repo participation [18] - In China, the bond repurchase market has developed rapidly over the past 30 years, with a structure characterized by a dominant interbank market and a smaller exchange market [19] Group 8 - The interbank bond market in China primarily features pledge-style repos, which account for over 90% of the settlement volume, while buyout repos are less common [19][20] - The exchange bond market includes various types of repos, with pledge-style repos being the most prominent, and buyout repos limited to government bonds [21][22] Group 9 - The article highlights key differences between domestic and international bond repurchase markets, including participant structure, types of repos, collateral types, and infrastructure [23][24] - It emphasizes the trend of increasing participant diversity and the predominance of buyout repos in international markets, suggesting that China could optimize its bond repurchase business by learning from international experiences [24]

1. Report Industry Investment Rating - No relevant content provided 2. Core View of the Report - The "Decision of the People's Bank of China on Amending and Repealing Certain Rules (Draft for Comment)" may lead to the transformation of bond repurchase in the inter - bank market from pledged repurchase to outright repurchase in the future, with outright repurchase potentially becoming the core of China's bond repurchase. Although there are currently few outright repurchase transactions, it has supporting facilities, experience, and is conducive to international integration [1][11]. - In the short term, the impact on the bond market may be neutral. Unfreezing pledged bonds can increase asset supply, enhance liquidity, and provide a short - selling channel for investors, but risk prevention is also necessary [3][18]. 3. Summary by Relevant Catalog 3.1 Understanding "Canceling the Freeze on Pledged Bonds for Bond Repurchase" - On July 18, 2025, the central bank proposed canceling the freeze on pledged bonds for bond repurchase, which is a modification of Article 31 of the "Administrative Measures for Bond Registration, Custody, and Settlement in the Inter - bank Bond Market" [8]. - As of the end of June 2025, the balance of pledged repurchase in the inter - bank bond market was 24.30 trillion yuan, while the balance of outright repurchase was 203.4 billion yuan, less than 1% of the pledged repurchase balance. Pledged repurchase only has a financing function, and the ownership of pledged bonds does not transfer, reducing their liquidity and being unfavorable to the rights and interests of the fund lender in case of default or rapid interest rate increases. Outright repurchase has both financing and short - selling functions, and the fund lender has greater operational flexibility [8][11]. 3.2 Outright Repurchase Has Supporting Facilities and Experience - In terms of facilities, the term of outright repurchase has been extended to 365 days, the accounting treatment has been clarified, and the function of quoting and trading multiple bonds in a single outright repurchase has been launched [2][12]. - In terms of experience, the central bank launched an open - market outright reverse repurchase operation tool in October 2024, and by June 2025, the balance reached 4.60 trillion yuan, replacing part of the MLF [2][12]. - Switching to outright repurchase is conducive to international integration. The main forms of international bond market repurchase are classic repurchase and buy/sell - back transactions, where bond ownership transfers. China's offshore repurchase business has started to revitalize pledged bonds [2][16]. 3.3 Future Outlook - In the short term, the impact on the bond market may be neutral. Although the central bank's statement has raised market expectations for bond trading, currently, the net sale of national bonds does not match the central bank's policy tone [3][18]. - Canceling the freeze on pledged bonds can increase asset supply, enhance liquidity, relieve institutional liability - side pressure, and provide a short - selling channel for investors, but it is necessary to prevent a sharp increase in the leverage ratio of the bond market [3][18]. - If the switch from pledged repurchase to outright repurchase occurs, the scale of pledged bonds involved is estimated to be 14.76 trillion yuan based on the central bank's balance sheet and 8.22 trillion yuan based on the monthly trading volume of pledged repurchase in June 2025, assuming a 90% pledge ratio [3][19].

Report Summary 1. Report Industry Investment Rating No industry investment rating information is provided in the content. 2. Core Viewpoints - The central bank's move to cancel the freeze on pledged bonds is mainly to enhance market liquidity, and domestic bond repurchase may shift from pledge - style to buy - sell - back style similar to the central bank's. The change from frozen pledged bonds to transferable and tradable ones can significantly boost bond liquidity, especially considering that the average daily trading volume of pledged repurchase in China in 2025 is 5 - 6 trillion yuan [6]. - Canceling the freeze on pledged bonds can facilitate the central bank's treasury bond trading operations and promote the high - level opening - up of the bond market [7]. - The pattern of the current bond yield increase may shift from the previous "central bank tightens funds → bond yield increases" to "stock market rises → bond yield increases". If the economy does not decline significantly in the second half of the year, funds in the bond market may gradually flow out [10]. 3. Summary by Relevant Catalogs Event Background - On July 18, 2025, the People's Bank of China issued a notice on soliciting public opinions on the "Decision of the People's Bank of China on Amending Some Regulations (Draft for Comment)", which includes the provision of "canceling the regulation on freezing the pledged bonds for bond repurchase" [4]. - On July 8, 2025, Jiang Huifen, Deputy Director of the Financial Market Department of the People's Bank of China, stated at the Bond Connect Anniversary Forum 2025 that it supports the Hong Kong CMU to cancel the freeze on repurchase pledged bonds and further revitalize the pledged bonds, referring to the international common practice of bond repurchase [5]. International Practice of Bond Repurchase - International bond repurchase is centered around buy - sell - back. Through legal mechanisms and market tools, non - frozen management of pledged bonds is achieved, with the core features of ownership transfer and maximum liquidity [5]. Purposes of Canceling Pledged Bond Freeze - **Enhancing liquidity**: After the central bank's modification, the shift from pledge - style repurchase to buy - sell - back means that pledged bonds change from a frozen state to a temporarily transferable and tradable state, which can greatly enhance bond liquidity [6]. - **Facilitating treasury bond trading**: Canceling the freeze on pledged bonds can increase the number of available bonds in the market and expand the scope of the central bank's bond - buying and selling operations [7]. - **Promoting opening - up**: It is in line with international practices, which helps promote the high - level opening - up of the bond market [7]. Misunderstandings of Canceling Pledged Bond Freeze - **Misunderstanding 1**: It is a wrong view that the reverse repurchase party can re - pledge or replace the pledged bonds. According to relevant regulations, during the repurchase period, both parties cannot use the pledged bonds. Allowing re - pledging may turn bond repurchase into credit repurchase and increase financial risks. Canceling the freeze actually increases the rights of the reverse repurchase party [8]. - **Misunderstanding 2**: There is no causal relationship between canceling the freeze on pledged bonds and the central bank's imminent treasury bond trading. Since large banks have been continuously buying bonds since May 12, 2025, the central bank's restart of bond - buying is not restricted by the issue of pledged bonds. Canceling the freeze is mainly to enhance the liquidity of existing bonds in the long - and medium - term [9]. Stock - Bond Switch under Economic Expectation Revision - The current pattern of bond yield increase may shift, and if the economy does not decline significantly in the second half of the year, funds in the bond market may gradually flow out. The rhythm may be similar to that in 2009 and 2020, with the stock market rising first, followed by a lagging increase in bond yields and finally an increase in the capital interest rate [10].

Core Viewpoint - The Tianhong Credit Bond ETF (159398) has been experiencing a positive trend, with significant trading volume and liquidity improvements following its inclusion in the general pledge repo system, which enhances its investment appeal and operational efficiency [2][4]. Group 1: Market Performance - The Tianhong Credit Bond ETF has seen a slight decline of 0.02% after three consecutive days of gains, with a trading volume exceeding 2.6 billion yuan and a turnover rate over 40% [1]. - The latest circulating scale of the Tianhong Credit Bond ETF has reached 6.413 billion yuan, marking a historical high [3]. Group 2: Investment Opportunities - The inclusion of the Tianhong Credit Bond ETF in the general pledge repo system is expected to improve liquidity and broaden financing channels, allowing investors to enhance capital efficiency and investment strategies [2]. - Recent data indicates that the Tianhong Credit Bond ETF has attracted over 710 million yuan in net inflows over the past five days, with a single-day inflow of 537 million yuan [2]. Group 3: Industry Insights - The rapid growth of the Shanghai and Shenzhen benchmark market-making credit bond ETF, which has surpassed 70 billion yuan since mid-May, has led to a significant decline in the valuation yield of medium to long-term credit bonds [4]. - Analysts suggest focusing on coupon opportunities and increasing allocations to medium to long-term credit bonds after the seasonal disturbances end [4].

Core Viewpoint - The approval of the first batch of 9 credit bond ETFs as general collateral for repurchase agreements marks a significant development in the market, allowing these products to engage in repurchase business starting June 6 [1][2]. Group 1: Product Details - The first batch includes 8 benchmark market-making credit bond ETFs from various fund companies, along with 1 company bond ETF from Ping An Fund, with a total fundraising amount of 24 billion yuan [2]. - The 8 benchmark market-making credit bond ETFs are listed on both the Shenzhen and Shanghai Stock Exchanges, with specific ETFs tracking the "Shenzhen Benchmark Market-Making Credit Bond Index" and the "Shanghai Benchmark Market-Making Corporate Bond Index" [2]. - The credit bond ETFs are designed to enhance liquidity and attract more investment, thereby reducing corporate financing costs [3]. Group 2: Market Impact - As of May 27, the total scale of bond ETFs in the market exceeded 280 billion yuan, with credit bond ETFs experiencing significant inflows of 58.155 billion yuan this year, bringing their total scale to over 130 billion yuan [3][4]. - The 8 benchmark market-making credit bond ETFs have seen a net inflow of 36.651 billion yuan since their launch, with a current scale of 58.611 billion yuan [4]. - The E Fund's Shanghai Benchmark Market-Making Corporate Bond ETF has become the first to exceed 10 billion yuan in scale, with an average daily trading volume of 2.75 billion yuan since its launch [4]. Group 3: Investor Benefits - The inclusion of credit bond ETFs in the collateral pool enhances their liquidity, providing investors with additional avenues for asset realization beyond traditional purchase and redemption [3]. - The development of credit bond ETFs is expected to improve capital efficiency for investors, broaden financing channels, and enrich investment strategies [3][6]. - The growing acceptance of credit bond ETFs among various investor types indicates a deepening understanding of the product, suggesting significant future growth potential in this market [6].

Group 1 - The core viewpoint of the article is the significant innovation in the bond market with the introduction of the pledge mechanism for credit bond ETFs, allowing for enhanced liquidity and financing options [1][2][3] - Nine credit bond ETFs have been approved for inclusion in the general pledge repo collateral list, marking an important step in the development of fund repurchase trials [1][2] - The inclusion of credit bond ETFs in the pledge repo system is expected to broaden financing channels for investors and improve capital efficiency, addressing previous limitations in the credit bond ETF market [3][6] Group 2 - The nine credit bond ETFs included in the pledge repo system have shown strong fundraising capabilities, with a total issuance scale of 21.71 billion yuan, and their total scale has increased to 62.37 billion yuan, reflecting a growth of 1.87 times since their launch [3][4] - The average daily trading volume of these ETFs has been robust, with an average turnover rate of 58.73%, indicating high market activity [4][5] - The bond ETF market has experienced explosive growth, with the total scale reaching 284.13 billion yuan as of May 29, 2023, representing a 60% increase since the beginning of the year [6][8] Group 3 - The credit bond ETFs are seen as versatile tools that can provide stable coupon income while allowing for quick position adjustments through T+0 trading, enhancing investor returns [7][8] - The average return of the nine credit bond ETFs since the beginning of the year is 0.56%, outperforming the overall average return of the bond ETF market [8]

Core Viewpoint - Ping An Fund's company bond ETF has received approval to enter the general pledge repo trading, making it the only pledgeable, short to medium duration credit bond ETF with a scale exceeding 15 billion yuan [1][2]. Group 1: Company Bond ETF Features - The company bond ETF has surpassed 15 billion yuan in scale, ranking among the top three in the market for credit bond ETFs [3]. - It is designed as a core trading tool for company bonds, focusing on high-grade credit bonds and central state-owned enterprise bonds with a medium to short duration [3]. Group 2: Liquidity and Risk Management - The inclusion of the company bond ETF in the pledge repo library enhances its liquidity, allowing investors to utilize it as a general pledge asset, thus providing additional liquidity advantages [2][6]. - Compared to actively managed products, the company bond ETF offers lower fees and better liquidity, with an average daily trading volume of nearly 1 billion yuan in 2025 [5]. Group 3: Performance Metrics - The company bond ETF has shown strong performance, with a maximum drawdown of only 0.5% over the past year, significantly lower than the average of 1.27% for similar products [4]. - Since its inception, the ETF has consistently outperformed its benchmark index, with annual returns of 3.38% in 2023 and 3.60% in 2024, and has distributed dividends totaling nearly 750 million yuan [4][7].

Group 1 - The People's Bank of China conducted a 7-day reverse repurchase operation of 157 billion yuan at an interest rate of 1.40%, resulting in a net injection of 65 billion yuan after 92 billion yuan of reverse repos matured on the same day [1][12]. - The Shanghai Interbank Offered Rate (Shibor) showed minor fluctuations, with the overnight Shibor remaining unchanged at 1.5090%, the 7-day Shibor decreasing by 0.70 basis points to 1.5490%, and the 14-day Shibor decreasing by 0.30 basis points to 1.6470% [1][2]. - In the interbank pledged repo market, short-term rates experienced slight declines, with DR001 and R001 weighted average rates down by 0.8 basis points and 1.3 basis points, respectively, while DR007 and R007 rates fell by 1.5 basis points and 1.0 basis points [4]. Group 2 - The money market maintained a balanced state, with overnight rates for deposits fluctuating between 1.50% and 1.53%, and the overall funding environment remaining loose [9]. - On May 21, 102 interbank certificates of deposit were issued, with a total issuance amount of 155.6 billion yuan [9]. - Following the recent trend, several banks, including Ping An Bank and CITIC Bank, announced a reduction in RMB deposit rates by 15 basis points for both 1-year and 2-year fixed deposits [12].