Analysis: How Macau is deepening offshore Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong Renminbi liquidity with Hong Kong The cooperation includes a new arrangement between the HKMA The cooperation includes a new arrangement between the HKMA and AMCM to facilitate a cross-border investment channel to clear, and AMCM to facilitate a cross-border investment channel to clear, settle, and hold bonds registered in either market; bond deals are settle, and hold bonds registered in either market; bond deals are climbing strongly in Macau. climbing strongly in Macau. Christopher Chu Christopher Chu April 15, 2025 April 15, 2025 Macau has issued debt instruments are capitalising on policy developments in Hong Macau has issued debt instruments are capitalising on policy developments in Hong Kong, where the financial hub is cementing its linkages among the Special Administrative Kong, where the financial hub is cementing its linkages among the Special Administrative ADVERTISEMENT ADVERTISEMENT christopher.chu@haymarket.asia christopher.chu@haymarket.asia | | Sign Out Sign Out We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 1/10 Regions (SARs) and across the Greater Bay Area (GBA). Regions (SARs) and across the Greater Bay Area (GBA). The trends come as The trends come as bankers bankers have noted ‘cheaper for longer’ Renminbi (Rmb) funding have noted ‘cheaper for longer’ Renminbi (Rmb) funding costs concurrently with the introduction of repurchase arrangements which are expected costs concurrently with the introduction of repurchase arrangements which are expected to boost liquidity in the offshore debt space. to boost liquidity in the offshore debt space. In the first three months of this year, 96 bonds were In the first three months of this year, 96 bonds were listed listed on Chongwa (Macau) on Chongwa (Macau) Financial Asset Exchange (MOX), totalling more than MOP82 billion ($10 billion). The Financial Asset Exchange (MOX), totalling more than MOP82 billion ($10 billion). The number represents a jump from the 73 deals and the MOP43 billion number represents a jump from the 73 deals and the MOP43 billion raised raised up to the same up to the same point in 2024, when, for the entire year, the city point in 2024, when, for the entire year, the city undertook undertook 346 deals accumulating to 346 deals accumulating to MOP229 billion in its campaign to diversify the economy away from its gaming revenues. MOP229 billion in its campaign to diversify the economy away from its gaming revenues. The emergence of Macau’s nascent debt market coincides with Hong Kong’s ongoing The emergence of Macau’s nascent debt market coincides with Hong Kong’s ongoing innovation to reinforce itself as an international finance centre with ties to the GBA. Back innovation to reinforce itself as an international finance centre with ties to the GBA. Back in December, Zhuhai Huafa Group, the largest state-owned property developer in Zhuhai, in December, Zhuhai Huafa Group, the largest state-owned property developer in Zhuhai, raised raised a Rmb1.4 billion ($191 million) three-year digital bond that was dual listed in both a Rmb1.4 billion ($191 million) three-year digital bond that was dual listed in both Hong Kong and Macau, allowing mainland Chinese investors access via the Southbound Hong Kong and Macau, allowing mainland Chinese investors access via the Southbound Bond Connect Scheme. Bond Connect Scheme. While the Rmb has weakened against most major currencies to support its economy amid While the Rmb has weakened against most major currencies to support its economy amid a a deepening deepening trade war with the US, tightening links between the SARs continue to bode trade war with the US, tightening links between the SARs continue to bode well for the Rmb along with Beijing’s growing ambitions to internationalise the Chinese well for the Rmb along with Beijing’s growing ambitions to internationalise the Chinese currency. currency. HKMA, AMCM connectivity HKMA, AMCM connectivity ADVERTISEMENT ADVERTISEMENT We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 2/10 Bank of China Macau launched a two-year Rmb1 billion ($140 million) bond a day after Bank of China Macau launched a two-year Rmb1 billion ($140 million) bond a day after the Hong Kong Monetary Authority (HKMA) and the Monetary Authority of Macau the Hong Kong Monetary Authority (HKMA) and the Monetary Authority of Macau (AMCM) (AMCM) connected connected their respective clearance and settlement systems in a move designed their respective clearance and settlement systems in a move designed to ease market access for investors. to ease market access for investors. The deal serves as a litmus test for Macau, where its use of the Portuguese language and The deal serves as a litmus test for Macau, where its use of the Portuguese language and its familiar legal system make it an attractive bridge for Portuguese speaking countries its familiar legal system make it an attractive bridge for Portuguese speaking countries (PSC) connecting to Mainland China, notes Eduardo Loureiro, international lawyer and (PSC) connecting to Mainland China, notes Eduardo Loureiro, international lawyer and arbitrator with the Macau-based firm BN Lawyers, adding that the offshore Rmb market arbitrator with the Macau-based firm BN Lawyers, adding that the offshore Rmb market offers currency diversification opportunities for SAR based companies. offers currency diversification opportunities for SAR based companies. The ties extend both SAR’s objectives to bolster their financial linkages with the The ties extend both SAR’s objectives to bolster their financial linkages with the mainland. In mid-January, the HKMA and the People’s Bank of China mainland. In mid-January, the HKMA and the People’s Bank of China announced announced six six policy measures to broaden their financial cooperation by expanding the eligible policy measures to broaden their financial cooperation by expanding the eligible collateral list for the HKMA’s Rmb Liquidity Facility to include yuan bonds issued collateral list for the HKMA’s Rmb Liquidity Facility to include yuan bonds issued We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 3/10 onshore, and well as further opening the onshore repurchase agreement (repo) market to onshore, and well as further opening the onshore repurchase agreement (repo) market to all foreign institutional investors. all foreign institutional investors. Despite developments in Macau, Hong Kong remains the critical hub for offshore Rmb Despite developments in Macau, Hong Kong remains the critical hub for offshore Rmb business. business. Hong Kong chief executive John Lee noted that Rmb deposits in Hong Kong reached 1.1 Hong Kong chief executive John Lee noted that Rmb deposits in Hong Kong reached 1.1 trillion last year, where 80% of the world’s offshore payments are processed in the city. trillion last year, where 80% of the world’s offshore payments are processed in the city. In his late February speech, financial secretary Paul Chan In his late February speech, financial secretary Paul Chan said said Hong Kong would press Hong Kong would press ahead with the development of the offshore Rmb ecosystem by facilitating cross- ahead with the development of the offshore Rmb ecosystem by facilitating cross- boundary investments and two way fund flows between Hong Kong and mainland China. boundary investments and two way fund flows between Hong Kong and mainland China. ADVERTISEMENT ADVERTISEMENT We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 4/10 Feedback Feedback Macau’s role Macau’s role In addition to enhanced links to Hong Kong and mainland’s financial infrastructure, In addition to enhanced links to Hong Kong and mainland’s financial infrastructure, Macau’s policy reforms have streamlined the bond issuance process. Macau’s policy reforms have streamlined the bond issuance process. The city’s Financial System Act (FSA) has simplified the procedure by delegating approval The city’s Financial System Act (FSA) has simplified the procedure by delegating approval to the Macau Central Securities Depository and Clearing Limited (MCSD), in a move seen to the Macau Central Securities Depository and Clearing Limited (MCSD), in a move seen to shorten approval times and open the door to new products that can be sold to both to shorten approval times and open the door to new products that can be sold to both professional and retail investors. professional and retail investors. “Macau not only offers low tax rates and facilitates free movement of capital and currency “Macau not only offers low tax rates and facilitates free movement of capital and currency exchange with a highly open financial system, but there is also an exemption in terms of exchange with a highly open financial system, but there is also an exemption in terms of Stamp Duty Tax for Bonds issuance and transactions,” Loureiro explains, adding that he Stamp Duty Tax for Bonds issuance and transactions,” Loureiro explains, adding that he expects continued government support for the local bond market, including regular expects continued government support for the local bond market, including regular issuances of sovereign bonds. issuances of sovereign bonds. “The aim is to develop Macau into one of the key bond listing markets in Asia namely for “The aim is to develop Macau into one of the key bond listing markets in Asia namely for offshore Rmb bonds and free trade zone bonds,” he said. offshore Rmb bonds and free trade zone bonds,” he said. “By promoting a diversified investor base, a larger pool of potential investors can lead to “By promoting a diversified investor base, a larger pool of potential investors can lead to better price discovery amid liquidity improvements, opening access to both Asian and better price discovery amid liquidity improvements, opening access to both Asian and European markets that promotes cross-border investments and financial innovation.” European markets that promotes cross-border investments and financial innovation.” ¬ Haymarket Media Limited. All rights reserved. ¬ Haymarket Media Limited. All rights reserved. We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 5/10 Markets Markets North Asia North Asia Debt Debt #macau #macau #hong kong #hong kong #renmibi liquidity #renmibi liquidity ADVERTISEMENT ADVERTISEMENT We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 6/10 Promoted Content Promoted Content VIDEO: Deutsche Bank sees strong pipeline VIDEO: Deutsche Bank sees strong pipeline in Asia Pacific M&A in Asia Pacific M&A A challenging market backdrop offers scope for increased M&A A challenging market backdrop offers scope for increased M&A activity in Asia Pacific in 2025. Rohit Satsangi and Zi-Kuan Lim, Co- activity in Asia Pacific in 2025. Rohit Satsangi and Zi-Kuan Lim, Co- Heads of M&A for Deutsche Bank in the region, talk to FinanceAsia Heads of M&A for Deutsche Bank in the region, talk to FinanceAsia about the key opportunities, and why the firm is well-positioned to about the key opportunities, and why the firm is well-positioned to capitalise on them. capitalise on them. In partnership with In partnership with Deutsche Bank Deutsche Bank April 01, 2025 April 01, 2025 In today’s challenging economic and political environment, uncertainty is a consistent In today’s challenging economic and political environment, uncertainty is a consistent theme. Multiple geopolitical forces are contributing to this dynamic – from rising theme. Multiple geopolitical forces are contributing to this dynamic – from rising tensions amid new tariffs, to increasingly common protectionist policies, to alliances tensions amid new tariffs, to increasingly common protectionist policies, to alliances being formed and broken. For M&A deals, however, there are positive repercussions, being formed and broken. For M&A deals, however, there are positive repercussions, especially for cross-border activity. especially for cross-border activity. We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 7/10 “Inflation rates and interest rates came down in 2024, also helping the environment for “Inflation rates and interest rates came down in 2024, also helping the environment for dealmaking in 2025,” explained Rohit Satsangi, Co-Head of M&A for Deutsche Bank in dealmaking in 2025,” explained Rohit Satsangi, Co-Head of M&A for Deutsche Bank in Asia Pacific. Asia Pacific. The bank, which won an array of awards and accolades from FinanceAsia for its M&A, The bank, which won an array of awards and accolades from FinanceAsia for its M&A, private equity, infrastructure and property expertise across the region in 2024, is eyeing a private equity, infrastructure and property expertise across the region in 2024, is eyeing a new wave of activity. new wave of activity. “We continue to see a strong pipeline coming to market, especially for sponsor driven “We continue to see a strong pipeline coming to market, especially for sponsor driven [deals],” explained Zi-Kuan Lim, Deutsche Bank’s other Co-Head of M&A in Asia Pacific. [deals],” explained Zi-Kuan Lim, Deutsche Bank’s other Co-Head of M&A in Asia Pacific. Regional hotspots: three key themes to watch in 2025 Regional hotspots: three key themes to watch in 2025 Among the many emerging opportunities in the region this year, three broad trends stand Among the many emerging opportunities in the region this year, three broad trends stand out for Deutsche Bank to pursue. out for Deutsche Bank to pursue. Firstly, the year-on-year growth in financial sponsor activity continues to garner attention. Firstly, the year-on-year growth in financial sponsor activity continues to garner attention. More specifically, from the supply side, these firms have opted to not sell their assets, More specifically, from the supply side, these firms have opted to not sell their assets, instead waiting for a more stable environment and more robust performance, explained instead waiting for a more stable environment and more robust performance, explained Satsangi. “We’re seeing a lot of assets being brought back to market.” Satsangi. “We’re seeing a lot of assets being brought back to market.” Meanwhile, on the demand side, he sees a lot of dry powder, describing it as “the highest Meanwhile, on the demand side, he sees a lot of dry powder, describing it as “the highest there’s ever been”. As a result, firms need to deploy these funds as soon as they can. there’s ever been”. As a result, firms need to deploy these funds as soon as they can. We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. To find out more, please click here here . By continuing to use our . By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 8/10 Feedback Feedback A second key theme is take-private transactions. This stems from what Satsangi has A second key theme is take-private transactions. This stems from what Satsangi has observed as a convergence in valuation expectations between buyers and sellers, in observed as a convergence in valuation expectations between buyers and sellers, in particular in Australia, Japan and Hong Kong. In relation to this trend, the bank advised particular in Australia, Japan and Hong Kong. In relation to this trend, the bank advised on multiple award-winning deals last year, and expects this will continue in 2025. on multiple award-winning deals last year, and expects this will continue in 2025. Another trend is digital infrastructure, a sector in which Deutsche Bank saw some of the Another trend is digital infrastructure, a sector in which Deutsche Bank saw some of the largest deals in 2024 as key players underwent consolidation – a trend which is largest deals in 2024 as key players underwent consolidation – a trend which is continuing. “We're seeing that activity run into 2025, [and it is] expected to heighten over continuing. “We're seeing that activity run into 2025, [and it is] expected to heighten over the course of this year,” added Satsangi. the course of this year,” added Satsangi. Leadership and innovation Leadership and innovation In looking to capitalise on the pipeline of deals across Asia Pacific, Deutsche Bank is In looking to capitalise on the pipeline of deals across Asia Pacific, Deutsche Bank is leveraging its track record. “Clients are not only looking for local, in-country experts, but leveraging its track record. “Clients are not only looking for local, in-country experts, but also trusted advisors that can deliver the regional and global expertise and experience,” also trusted advisors that can deliver the regional and global expertise and experience,” explained Lim. explained Lim. This also means tapping into global partners to bring the execution capability of the This also means tapping into global partners to bring the execution capability of the entire bank to clients – not just M&A, but also financing and FX. “[Our] ability to run entire bank to clients – not just M&A, but also financing and FX. “[Our] ability to run differentiated, tailored and focused sales processes has led to successful outcomes for differentiated, tailored and focused sales processes has led to successful outcomes for our clients,” he added. our clients,” he added. This approach has benefitted companies in various markets. Some Chinese clients, for This approach has benefitted companies in various markets. Some Chinese clients, for example, have found it hard to manage their businesses abroad, turning to Deutsche example, have found it hard to manage their businesses abroad, turning to Deutsche Bank to help them exit. And in Japan, where growth at home has been muted, companies Bank to help them exit. And in Japan, where growth at home has been muted, companies have been looking for cross-border acquisitions, especially as activists enter their have been looking for cross-border acquisitions, especially as activists enter their shareholder list. shareholder list. “As deals get more complex and cross border, we have been able to be the trusted APAC “As deals get more complex and cross border, we have been able to be the trusted APAC M&A adviser given our track record across all these key markets in the region,” said Lim. M&A adviser given our track record across all these key markets in the region,” said Lim. ¬ Haymarket Media Limited. All rights reserved. ¬ Haymarket Media Limited. All rights reserved. We use cookies to improve your experience and to analyse our traffic. To find out more, please click We use cookies to improve your experience and to analyse our traffic. 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By continuing to use our website, you accept our website, you accept our Privacy Policy Privacy Policy and and Terms & Conditions Terms & Conditions OK OK 4/16/25, 10:16 AM Analysis: How Macau is deepening offshore Renminbi liquidity with Hong Kong | FinanceAsia https://www.financeasia.com/article/analysis-how-macau-is-deepening-offshore-renminbi-liquidity-with-hong-kong/501983 9/10 Promoted Content Promoted Content #deutsche bank #deutsche bank #asia pacific #asia pacific #ma #ma FollowUs FollowUs Products Products Magazine Magazine Newsletter Newsletter Newsletter Signup Newsletter Signup RSS feed RSS feed Advertise Advertise Who We Are Who We Are What We Do What We Do Trust Principles Trust Principles Editor's Desk Editor's Desk Talk To Us Talk To Us Career Career Privacy Policy Privacy Policy Terms & Conditions Terms & Conditions Contact Us Contact Us Haymarket Financial Media Haymarket Financial Media AsianInvestor AsianInvestor CorporateTreasurer CorporateTreasurer ©Haymarket Media Ltd. ©Haymarket Media Ltd. ver: 2.9.5+4305e94d99 We use cookies to improve your experience and to analyse our traffic. 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