Buyback and stake-increase relending made permanent with rate cut to 1% from 1.25%; CSRC plans to ease price-support buybacks and broaden stock-support tools.
The People's Bank of China, together with the NFRA and CSRC, held symposiums on 2 November on the securities, funds and insurers swap facility (SFISF) and on share buyback and stake-increase relending. NBD (about 20:06), Yicai (about 20:49) and Xinhua Finance reported that the buyback relending policy would shift from a temporary arrangement to a permanent institutional facility, with the relending rate cut from 1.25% to 1%; banks would still price loans by adding a market markup and increase lending; and that SFISF operations would be conducted as appropriate with more participants and moderately lower swap fees (the 3 November SFISF tender notice was already published yesterday at chinaday.news/i/77). Officials said about 440 billion yuan of buyback/stake-increase loans had been contracted and more than 280 billion yuan disbursed; SFISF outstanding was 105 billion yuan. In a same-day Q&A the CSRC said it would work with the PBOC to use both tools fully; plans to ease price-support buybacks include allowing buybacks when a stock trades below its IPO price, lifting the six-month listing wait and the ban on open/close auction orders, and pressing firms with excess IPO proceeds or trigger conditions to buy back promptly; it also plans counter-cyclical tweaks to margin financing and faster active-ETF deployment. Bloomberg via Mint and Caixin Global also reported the rate cut to 1%, permanence of the facility and planned buyback-rule easing.
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