Citi To Provide Offshore Funds Stock Connect Access

Citi’s depositary bank business will now allow AIFs and UCITS funds to trade China’s domestic A-Shares through the Shanghai-Hong Kong Stock Connect scheme.

Citi was the first to develop the Model C solution, which helps overcome key challenges for regulated offshore funds, by ensuring effective segregation of fund assets. Model C also enables assets to remain with a qualified custodian, by eliminating the need for pre-delivery of shares to the local broker.

To access Stock Connect, fund managers will need to comply with Citi’s standard terms and conditions, and complete their due diligence regarding the suitability of investing through Stock Connect for each applicable fund.

“By providing a solution that allows [offshore funds] to comply with the regulatory regime of their domicile countries and to transact in a safe and efficient way”, says Cindy Chen, Hong Kong head of securities services, Citi.