Deutsche Boerse (DB), a leading global service provider for securities and derivatives markets, will set up a joint venture with two Chinese peers to develop and market Chinese financial instruments to investors outside the Chinese mainland, according to a joint statement issued on Wednesday.
The joint venture is designed to support the internationalization of the Chinese currency, the Renminbi (RMB).
The Frankfurt-based company will be called China Europe International Exchange and will begin operations in the fourth quarter of this year. The main function of the company will be developing RMB-denominated securities and derivatives products.
Shanghai Stock Exchange (SSE) and DB will each hold 40 percent and China Financial Futures Exchange (CFFE) will own the remaining 20 percent of the venture.
The cross-border use of the RMB is increasing rapidly, and RMB internationalization has become an important strategy in opening up China's economy and financial industry.
"In the context of China's capital market liberalization, the offshore trading platform set up by the three exchanges will further promote the two-way opening up of China's capital market, enrich the product line of the offshore RMB market and accelerate the pace of RMB internationalization," said Gui Minjie, chairman of SSE.
"The establishment of the RMB asset trading platform by SSE, CFFE and DB is a milestone for Chinese exchanges and the capital market in general," said Zhang Shenfeng, CFFE chairman.
Founded in 1990, SSE is the largest stock exchange in China and the third largest in the world. In terms of total market capitalization, trade value and capital raised, SSE ranks third, second and third, respectively.
Founded in 2006, CFFE is China's only financial derivatives exchange.
