On October 18, People's Bank of China, in collaboration with National Financial Regulatory Administration and China Securities Regulatory Commission, issued the Notice on Matters Related to the Establishment of Re-lending Loans for Share Repurchase and Shareholding Increase. The initial re-lending will be RMB 300 billion at an interest rate of 1.75 percent and a maturity of one year, which can be extended as appropriate. According to the Securities Times, following the new policy, 13 SSE companies applied for the first batch of loans and issued relevant announcements during weekend. Among them, 11 companies listed on the SSE Main Board secured a total of RMB 5.176 billion of relending loans for share repurchase and shareholding increase, including about RMB 2.330 billion dedicated to share repurchase and about RMB 2.846 billion for shareholding increase.
The relending loans launched this time offer robust financial support to SSE companies, enabling them to implement the share repurchase and shareholding increase plan at a lower interest rate. This is expected to significantly boost their enthusiasm for share repurchase and shareholding increase. On the evening of October 20, the four listed companies (COSCO SHIPPING Holdings Co., Ltd., COSCO SHIPPING Development Co., Ltd., COSCO SHIPPING Energy Transportation Co., Ltd., and COSCO SHIPPING Specialized Carriers Co., Ltd.) under China COSCO Shipping Corporation Limited collectively issued an announcement for share repurchase and shareholding increase.
The newly launched policy has also provided more funding sources for companies that have previously disclosed their plans to buy back shares and boost shareholdings. Listed companies, including China Petroleum & Chemical Corporation, China Merchants Energy Shipping Co., Ltd., GigaDevice Semiconductor (Beijing) Inc., Zhejiang Jiahua Energy Chemical Industry Co., Ltd., Sinotrans Limited, and Shandong Linglong Tyre Co., Ltd., have issued announcements to expand their funding sources.
Excerpted from Securities Times on October 20, 2024
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The above information is provided for reference purposes only and does not constitute investment advice.
