On May 28th and 29th, Shenzhen Stock Exchange (SZSE), under the guidance of CSRC, organized and held a training seminar on capital market serving private listed companies. A total of more than 200 representatives from over 90 private listed companies and relevant securities companies, public funds, private funds and local asset management companies attended the seminar. Held in China Capital Market Institute, the seminar was attended and addressed by the officials from the CSRC Corporate Bond Regulatory Department and Listed Company Regulatory Department and the SZSE.
During the capital market development, CSRC has been upholding the policy of "Two Unwaverings" and energetically supporting the growth of private enterprises. Since last year, regulatory authorities have attached great importance to private firms' issues faced in difficult financing and equity pledge risks and the resulting liquidity difficulty of listed companies and have supported the listed units and their major shareholders in mastering and utilizing bond financing, equity acquisition, asset restructuring and other market instruments. With regard to market participants' opinions and suggestions in response to the difficulties and pain points in practice, the regulatory departments have pooled wisdom, focused on removing policy obstacles, and stepped up the resolution of private firms' development difficulties so as to effectively defuse potential risks. At the seminar, the competent departments of CSRC and SZSE deeply interpreted the regulatory policies on bond financing and M&A restructuring and specifically explained the policy key points needed understanding in private enterprises' financing and bailout processes. Some private enterprise shareholders, listed companies and market institutions shared successful experience in market financing and addressing equity pledge risks, offering suggestions to better support the development of private enterprises.
To improve the effectiveness of the training, the seminar provides a special communication platform, which is one of the highlights, for private firms and institutional investors to discuss in groups and connect on a deep level. It shall effectively advance the cooperation between financing and investing parties, help forge consensus and lead to synergy. As expressed by the attendees, the seminar was a measure taken by CRSC and SZSE to implement the requirements in the keynote speech delivered by General Secretary Xi Jinping, and the Opinions on Enhancing Financial Services to Private Firms as issued by the General Office of the CPC Central Committee and the General Office of the State Council, and to serve the real economy. It shall familiarize the companies with regulatory policies on debt financing in the capital market, help alleviate the financing difficulties of private firms with market-based approaches, improve the quality of listed companies and promote the sound and stable development of both private and public companies.
SZSE has made full use of the clustering effect of private firms, a special advantage, to promote product innovation in the bond market as well as the private firm financing environment. At the end of April 2019, there are 491 SZSE-listed enterprise bonds continuing to mature, accounting for 33% of the existing listed corporate bonds in the market, with a par value of CNY417 billion, or 27% of the total par value of all corporate bonds. Besides, SZSE has also adjusted the applicability of stock pledge-type repurchase rules. There were 47 cases where shareholders of private firms borrowed from securities companies to pay previous debts or where contracts were extended, with CNY8.2 billion involved. There were 17 transactions conducted for credit protection contracts, representing CNY2.2 billion of debt financing for private firms. Five bail-out bonds were issued to raise CNY7.0 billion in total. Next, SZSE shall continue to implement the decision and arrangements of CSRC, fully consider the opinions and suggestions of attendees, serve private firms with multiple measures, and further satisfy their financing needs. SZSE shall support private firms to grow and prosper by means of the capital market, and provide solid support for the sound development of the private economy.
