The National Association of Financial Market Institutional Investors (NAFMII) and the Beijing Financial Assets Exchange (BFAE) signed the Memorandum of Understanding (MOU) on cooperation in Beijing on March 25, 2011. At the same time, the NAFMII granted a tablet "NAFMII Authorized Trading Platform” to the BFAE. The move is intended to carry out the strategic arrangement under the Twelfth Five-year Plan and the requirement of “continuing to vigorously develop the financial markets and encouraging financial innovation in China” stressed by Premier Wen Jiabao in the Government Work Report. To further expedite the construction of the financial market system, to improve financial infrastructures and to strengthen the self-regulatory management in the financial market are also the objectives to be achieved. The ceremony was attended by Liu Shiyu, the Deputy Governor of the People’s Bank of China, Ji Lin, the Executive Vice Mayor of the People’s Government of Beijing Municipality and Li Xiaohong, Vice Chairman of the Beijing People’s Political Conference.

In the Eleventh Five-year Plan period, the multilevel financial market system was improved in success, and served as a robust boost for the continuous and healthy development of the national economy, according to the generic requirement of the CPC Central Committee and the State Council, and on back of the active promotion by the People’s Bank of China and other authorities. As an important part of the financial market system, the interbank bond market has taken a long stride in the past five years and achieved a swift expansion of market scale. China’s outstanding bonds had hit RMB20.4 trillion by the end of 2010. Benefiting from the rapid growth of the bond market, the proportion between direct financing and indirect financing, which was imbalance in the past, has changed for the better to some extent. The social financing structure has been optimized step by step, and the interbank bond market has played an increasingly important role in promoting the implementation of the macroeconomic policy of the state, optimizing the resource allocation and giving a bigger support to the economic development.

In the first year of the Twelfth Five-year Plan, the signing of the MOU between the NAFMII, as the self-regulatory organization of the interbank bonds market, and the BFAE, the financial asset exchange platform in the capital, is vitally important in financial innovation. First, this is a beneficial exploration in improving financial market infrastructures. As a trading platform, the BFAE is a hub of market resources, information, funds, talented people and services and an important market infrastructure. A strengthened support of the NAFMII to the platform will help explore new modes of optimizing market infrastructures and continuously improving the function of the financial market in resource allocation. Second, this is an active attempt to deepen the self-regulatory management and lift the service level. Since the very outset, the NAFMII has dedicated itself to lifting the level of self-regulatory management and the quality of member services. The current cooperation is also an important of the NAFMII in this regard. Third, this is a concrete practice in optimizing the resource allocation and promoting the scientific development of economy and finance. Under the innovative cooperation mechanism, both parties will closely watch the actual conditions of the economic development to step up product innovation and institutional innovation, effectively exert the resource allocation function of the financial trading platform and better serve the global picture of the national economic development.

By establishing the cooperation mechanism, the NAFMII and the BFAE will carry out close cooperation and exchange to regularize the financial asset trading platform and drive the development of the financial asset trading market in order. This will lay a solid foundation for both parties to deepen the bilateral cooperation in broader areas and aspects. Both parties said they would adhere to the principle of “pragmatic cooperation, mutual benefit”, target the global picture of propelling the economic and financial development, firmly cooperate in concrete affairs, and make new greater contributions to carrying out the Twelfth Five-year Plan, improving the financial market system and promoting the sustainable, healthy and scientific development of the economy and social undertakings in the capital.

The ceremony was also attended by relevant leaders and competent officials of the Financial Market Department of the People’s Bank of China, the Beijing Municipal Bureau of Human Resources and Social Security, the Financial Work Bureau of Beijing Municipality, the Xicheng District People’s Government, the NAFMII and the BFAE.