Year of the dragon to bring fresh Chinese market reforms
As the country prepares to ring in the New Year on 23
January, Chinese regulators are planning a range of improvements for the
nation’s securities markets in the next 12 months.
The China Securities Regulatory Commission (CSRC) announced
earlier this week it would focus on modifying rules relating to the bond markets,
IPOs and delisting mechanisms.
CSRC chairman Guo Shuqing said a larger proportion of
direct financing of Chinese public companies should come from corporate bonds
and that the regulator would look into the development of new bond products
like municipal bonds and high-yield bonds from state-owned enterprises.
He also revealed criteria for IPO documentation would ensure
information was more “comprehensive, complete and accurate” and insisted stock pricing
should be more closely aligned with the issuer’s fundamentals.
“Substantial measures must be taken to address the
overpricing of IPOs and malicious speculation on the shares of poorly
performing companies,” Guo said.
It is also believed China may launch as early as March a new
centralised system for securities lending and short selling. The China
Securities Finance Corporation, established October last year is thought to be
the vehicle through which approved securities companies would be able to short