Basic knowledge of the inter-bank bond market The national inter-bank bond market refers to the market that relies on China Foreign Exchange Trading Center, National Inter-bank Funding Center (hereinafter referred to as the Inter-bank Funding Center) and China Securities Depository and Clearing Corporation (hereinafter referred to as the Central Registration Corporation), including commercial banks, rural credit cooperatives, insurance companies, securities companies and other financial institutions to buy and sell bonds. Its main functions are: to provide inter-bank foreign exchange trading, RMB interbank lending, bond trading system and organize market transactions; Handle the settlement and delivery of foreign exchange transactions, and be responsible for the liquidation supervision of RMB interbank lending and bond transactions; Provide online bill quotation system; Providing information services in the foreign exchange market, bond market and money market; Established on June 6, 1997. After rapid development in recent years, the inter-bank bond market has become the main body of China bond market. Most book-entry treasury bonds and policy financial bonds are issued and traded in this market. 1. Bond varieties in the inter-bank bond market (1) There are different types of bonds in the inter-bank bond market, which are divided into: national debt-refers to bonds issued by the state. Compared with other types of bonds, the main issuer of national debt is the state, which has a high degree of credibility and is known as "Phnom Penh bond". Policy financial bonds refer to financial bonds issued by China policy banks (China Development Bank, Export-Import Bank of China Agricultural Development Bank and China Agricultural Development Bank) to Chinese-funded commercial banks, commercial insurance companies, city commercial banks, rural credit cooperatives, postal savings and remittance bureaus and other financial institutions with the approval of the People's Bank of the State Council and China. CITIC bonds refer to bonds issued by China International Trust and Investment Corporation. At present, there are two issues of CITIC bonds in the inter-bank bond market. (2) Divided into: Discounted bonds-refers to bonds that are issued below par value (usually 100 yuan par value), with a maturity of less than one year, and are repaid at par value at maturity. Zero coupon bond (also known as interest-bearing bonds)-refers to bonds that specify the coupon rate and maturity date of the bonds at the time of issuance, and repay all principal and interest at maturity. Coupon bond-refers to a bond that specifies the coupon rate and interest-paying frequency (such as annual interest payment) and interest-paying date of the bond at the time of issuance, and pays the last interest and all the principal at maturity. (3) According to whether the interest rate is fixed or not, it is divided into: fixed interest rate bonds-fixed interest rate bonds have a fixed interest rate and a fixed repayment period, which is a relatively traditional bond. This kind of bond is popular when the market interest rate is relatively stable, but it is risky when the interest rate changes sharply. Floating rate notes-floating rate notes is a medium-and long-term bond that is regularly adjusted according to the market interest rate. The interest rate is determined by the standard interest rate (interbank lending rate or bank preferential interest rate) plus or minus a certain interest rate basis point. Floating rate notes helps investors guard against interest rate risks. 2. Types of bond transactions in the inter-bank bond market Bond transactions in the inter-bank bond market include bond repurchase and spot bond transactions. Bond repurchase is a short-term financing business in which both parties pledge their rights with bonds. It refers to the financing behavior that the financing party (the repurchase party) pledges the bonds to the financing party (the reverse repurchase party) to integrate the funds, and both parties agree that the repurchase party will return the funds to the reverse repurchase party at the agreed repurchase rate in the future, and the reverse repurchase party will return the original pledged bonds to the repurchase party. Spot bond transaction refers to the transaction behavior that both parties transfer the ownership of bonds at an agreed price. 3. Bond trading mode in the inter-bank bond market: participants in the inter-bank bond market trade with their selected counterparties one by one by way of inquiry, which is different from the trading mode of domestic Shanghai and Shenzhen stock exchanges. Like stock trading, the bond trading conducted by the exchange is made by many investors at the same bidding price through computers. 4. China Securities Depository and Clearing Co., Ltd. is an intermediary in the inter-bank bond market, providing bond custody, settlement and information services for market participants; The National Interbank Funding Center provides intermediary and information services for market participants' quotations and transactions. Authorized by the People's Bank of China, the Interbank Funding Center and the China Government Securities Depository and Clearing Corporation can disclose relevant market information.