China launched its long-awaited Southbound Bond Connect on Friday in the latest step to deepen financial cooperation between the Chinese mainland and Hong Kong.

The program enables institutional investors in the Chinese mainland to invest in the Hong Kong bond market. The annual quota of the program is currently set at 500 billion yuan ($77.38 billion), with a daily quota of 20 billion yuan.

Bank of China (Hong Kong), HSBC Holdings and Standard Chartered are among the banks conducting trades on the first trading day. More than 40 mainland institutional investors and 11 Hong Kong market makers conducted more than 150 bond transactions worth approximately 4 billion yuan on Friday, the Bank of China data showed.

Established in July 2017, the Northbound Bond Connect, which allows overseas investors to trade bonds on the Chinese mainland, has hit 12.3 trillion yuan in accumulated turnover over the past four years.

The bond connection is also seen as an effort to further interlink the country's Greater Bay Area, including southern China's Guangdong Province and the Hong Kong and Macao Special Administrative Regions.