Interbank-borrowing (RMB)

Definition
Short-term borrowing between banks based on creditworthiness of the counterparties.

Service Category
Term in 11 options: 1 day, 7 days, 14 days, 21 days, 1 month, 2 months, 3 months, 4 months, 6 months, 9 months, 12 months, negotiable between the parties from the shortest of 1 day to the longest of 1 year.

Applicable Clients
State-owned commercial banks, joint-equity banks, city commercial banks, rural credit cooperatives, securities companies, financial companies, foreign banks licensed by PBOC to run RMB services in China.

Service Flow
1. Price: verbal quotation between two parties; 
2. Close: One party sends the borrowing instruction via China Inter-Bank Market System. Deal close when the other party approve and print the closing slip;
3. Settle: Once the deal and settlement date confirmed by both parties, borrowing bank receives monies from the lending bank and repays principal and interest in full upon maturity.

Price
Negotiate between the two parties referencing the China inter-bank offered rate.

Repurchase of Bond (Pledge)

Definition
Short-term borrowings collateralized by bond whereby the cash receiver (repo party) borrows money using the bond as pledge and repays principal and interest to cash provider (reverse party) at stated rate on the date specified. The lender at the same time releases the lock-up of the pledged bond.

Service Category
1.Repo (borrow money), reverse repo (lend money)
2.Term Repo in 11 options: 1 day, 7 days, 14 days, 21 days, 1 month, 2 months, 3 months, 4 months, 6 months, 9 months, 12 months, negotiable between the parties from the shortest of 1 day to the longest of 365 days.

Applicable Clients
Financial institutions incorporated in China who have signed the Master Repurchase Agreement of Pledged Bond in China Inter-Bank Bond Market, including commercial banks and their authorized branches, non-banking institutions and non-financial institutions, foreign banks licensed by PBOC to run RMB services in China, typically are state-owned commercial banks, joint-equity banks, city commercial banks, rural credit cooperatives, securities companies, financial companies or fund houses.

Service Flow
1. Price: verbal quotation between two parties; 
2. Close:
(1) One party sends the repurchase (pledge) instruction via China Inter-Bank Market System (RMB). Deal close when the other party approves and prints the closing slip;
(2) Both parties send settlement instructions to Central Bond Book-entry System which matches the two instructions to generate the settlement contract.
3. Settle: Once the deal and settlement date confirmed by both parties, repo party receives the monies from the reverse party. Bond under the contract will be locked-up.
4. Clearing upon maturity: repo party repays the principal and interest in full on the maturity date, and gets back the disposition right of the bond.

Price
Negotiate between the two parties referencing the market rate.

Repurchase of Bond (Buy-out)

Definition
Cash receiver (repo party) borrows money by selling the bond to the cash provider (reverse party) and promises to buy back equal number of the same bonds on a certain date at a stated price.

Service Category
1.Repo (borrow money, sell bond), reverse repo (lend money, buy bond);
2.Term Repo in 7 options: 1 day, 7 days, 14 days, 21 days, 1 month, 2 months, 3 months; negotiable between the parties from the shortest of 1 day to the longest of 3 months.

Applicable Clients
Financial institutions incorporated in China who have signed the Master Repurchase Agreement of Pledged Bond in China Inter-Bank Bond Market, including commercial banks and their authorized branches, non-banking institutions and non-financial institutions, foreign banks licensed by PBOC to run RMB services in China, typically are state-owned commercial banks, joint-equity banks, city commercial banks, rural credit cooperatives, securities companies, financial companies or fund houses.

Service Flow
1. Price: verbal quotation between two parties; 
2. Close:
(1) One party sends the repurchase (buy-out) instruction via China Inter-Bank Market System (RMB). Deal close when the other party approves and prints the closing slip;
(2) Both parties send settlement instructions to Central Bond Book-entry System which matches the two instructions to generate the settlement contract;
3. Settle: Once the deal and settlement date confirmed by both parties, repo party receives the monies from the reverse party. Reverse party get the bond;
4. Clearing upon maturity: repo party repays the principal and interest in full on the maturity date. Repo party gets back the disposition right of the bond.

Price
Negotiate between the two parties referencing the market rate.

Inter-bank borrowing (FX)

Definition
Unsecured no collateral/pledge short-term borrowing between Huaxia Bank and other banks.

Service Flow
1. Price: verbal quotation between two parties via phone or Reuters terminal; 
2. Close: Once the quote confirmed, both parties print the closing advice;
3. Settle: Once the deal closed, borrowing bank gets the monies from the lending bank and repays principal and interest in full upon maturity.

Price
Negotiate between the two parties referencing the FX inter-bank offered rate.