CITIC Bank Dalian Branch executes the bank's first customer large-scale commodity forward transaction

Source: Xinhua Finance

As geopolitical and international trade conditions change, price fluctuations in bulk commodities such as raw materials have increased, bringing enormous uncertainty and risk to business development. Locking in prices through bulk commodity forward transactions is a real need for many enterprises.

In this business, financial institutions such as banks can leverage advantages in funding, settlement, and other areas to provide targeted products and services for enterprises. This requires financial institutions to have full-licensing capabilities such as banking, futures, and trust, along with correspondingly high-level professional expertise. They also need exceptionally strong product innovation design and risk management capabilities.

CITIC Bank’s agency bulk commodity forward business has emerged precisely under these circumstances. Recently, under the guidance and precise enabling support of the Head Office’s Financial Markets Department, CITIC Bank Dalian Branch has fully leveraged the CITIC Group’s advantages of full-licensing financial capabilities, successfully completed CITIC Bank’s first agency bulk commodity forward business. This has added a more solid “price insurance lock” to help target enterprises manage costs, enabling companies to effectively hedge market fluctuations, lock in operating costs, and stabilize production expectations.

“This business has precisely solved our urgent problem of insufficient funds to participate in the futures market. During our coordination with CITIC Bank Dalian Branch, we saw comprehensive financial capabilities and a professional spirit that is both efficient and pragmatic. It has also allowed us to truly feel the ‘extreme service’ that the Dalian Branch has always advocated.” A relevant负责人 of the enterprise that completed the first deal said.

This business focuses on serving national-level “specialized, refined, unique, and innovative” enterprises and high-tech enterprises, closely follows the direction of production–finance integration and synergy in factor markets, and accurately matches enterprises’ needs for bulk commodity price risk management in their production and operations. To ensure the smooth rollout of the business, CITIC Bank’s Head Office overall coordinates resources. On the premise of CITIC Bank Dalian Branch fully understanding customer needs, CITIC Bank, CITIC Futures, and CITIC Securities achieve organic coordination and efficiently complete product design and end-to-end business operations. CITIC Futures provides professional and precise on-exchange strategies for customers. CITIC Securities, as the offset counterparty, provides professional support, forming an integrated service closed loop of “bank-led + futures-guided + securities as the offset counterparty,” fully releasing the Group’s synergy effectiveness.

In terms of business process, the Head Office’s Financial Markets Department provides end-to-end guidance on方案 design, rule interpretation, and risk control. The Dalian Branch’s Financial Markets and Intermediaries Department coordinates the relevant cooperative subsidiaries, overcomes difficulties, and drives the work forward. Branch outlets focus on customer needs, efficiently promote marketing execution and process implementation. With communication flowing top to bottom and fast responses, the business is ensured to be implemented to high standards.

At the same time, the financial markets segment, the corporate segment, and the risk segment closely cooperate, seamlessly linking key stages such as customer onboarding, credit approval, trade execution, and risk management and control. By leveraging cross-segment synergy, difficult points in the workflow of innovative businesses are addressed, ensuring the first order is completed smoothly, and enabling financial resources to precisely “drip” into the real economy.

The implementation of this business reflects CITIC Bank’s efforts to fully deliver on the “five major essays” of finance—using financial markets business to serve the real economy; using specialized financial innovation to empower technology finance; and contributing as a concrete measure to cultivate new quality productive forces. The restart of agency bulk commodity business further enriches the bank’s product lines for serving the real economy through factor markets, and improves its comprehensive service capability for core industry customers.

Next, CITIC Bank Dalian Branch will continue to deeply implement the Group’s “Three-Three-Five” strategy and the Head Office’s “Three-Three Strategy,” advance the “533145” project at the branch level in depth, continuously deepen business coordination, focus on bulk commodity business innovation and scenario expansion in factor markets, and steadily enhance its capability for comprehensive financial services and for creating professional value. With better-quality financial solutions, it will empower real industries and serve local economic development.

Editor: Wang Anlun

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