China regulators make share buyback relending a long-term tool, cut rate to 1%
The People’s Bank of China, the National Financial Regulatory Administration, and the China Securities Regulatory Commission held a meeting on two policy tools aimed at supporting the capital market, according to Odaily, citing Sina Finance. The meeting said the three agencies will keep policy support in place to help maintain capital market stability and improve market resilience and confidence. Officials said they will refine policy elements and implementation details, while encouraging financial institutions to make fuller use of the available tools. The meeting also said swap facility operations for securities firms, funds, and insurance companies may be carried out at an appropriate time. Authorities plan to expand the number of participating institutions, lower swap fees where appropriate, and optimize collateral and operating arrangements. The meeting also announced that the relending policy for share buybacks and stake increases will shift from a temporary arrangement to a long-term institutional framework. The relending rate will be reduced from 1.25% to 1%. Financial institutions are expected to follow market-based pricing principles, add a reasonable spread on top of the relending rate, and increase loan issuance.
