SINGAPORE - The Singapore Exchange (SGX) has signed an agreement with Industrial and Commercial Bank of China Limited (ICBC) to improve capital market links between Singapore and China.

Under memorandum of understanding, SGX will work with ICBC to promote Singapore's capital markets and support Chinese companies looking to list equities or bonds on SGX, with a focus on real estate investment trusts (REITs) and offshore RMB bonds.

In a statement out on Monday (Sept 19), SGX added that the two firms will also explore collaboration in derivatives trading, bond trading and market making of RMB denominated contracts listed on SGX.

The pact was signed between Mr Chew Sutat, head of equities and fixed income at SGX, and Mr Zhang Weiwu, general manager of ICBC Singapore branch.

The signing was witnessed by SGX chief executive Loh Boon Chye, and ICBC's board chairman Yi Huiman.

"We look forward to working with ICBC to enhance the collaboration between China and Singapore's capital markets, supporting Chinese companies to raise capital and seek investment opportunities through Singapore, whilst also helping to further internationalise the RMB," Mr Chew said in the statement.

ICBC's Mr Zhang added, "As China's largest bank and Singapore's sole RMB clearing bank, we are pleased to be working with SGX to encourage Chinese companies' participation in Singapore's capital markets, especially as Chinese companies continue to adopt an increasingly global outlook in their growth, expansion and funding prospects."