On May 20, in order to implement the decisions and arrangements of the CPC Central Committee and the State Council on coordinating epidemic prevention and control and economic development, the China Securities Regulatory Commission issued the “Notice on Further Exercising the Functions of the Capital Market to Support the Accelerated Recovery and Development of Severely Affected Areas and Industries” (below). Referred to as the “Notice”), 23 policy measures have been proposed for areas and industries severely affected by the epidemic. These measures have been fully investigated and researched in the early stage, and they have been implemented quickly and have strong operability, which has improved the sense of gain of market players.
“At present, the epidemic has repeatedly added difficulties to the operation of enterprises. The central government is making every effort to help enterprises, and finance plays an important role in the development of the real economy. The implementation of the 23 measures reflects that the financial regulatory authorities are actively helping enterprises to develop during special periods. The burden on enterprises and the desire to help enterprises better obtain direct financing.” Chuan CaisecuritiesChen Li, Chief Economist and Director of the Institute, was accepting thesecuritiesDaily reporter said in an interview.
Improve service quality and efficiency
Increase direct financing support
Expanding direct financing is an important means to support regions and industries severely affected by the epidemic to overcome difficulties and resume development. According to statistics from the reporter, since the beginning of this year, as of May 22, the amount of financing and refinancing in the A-share market has reached 640.257 billion yuan, a year-on-year increase of 13.64%, and the bond financing scale of Shanghai and Shenzhen Stock Exchange has reached 7,596.138 billion yuan, a year-on-year increase of 12.16%. Among them, 7 epidemic prevention and control bonds raised a total of 2.508 billion yuan. On the whole, the scale of direct financing in the capital market during the year exceeded 8.2 trillion yuan, a year-on-year increase of about 12%.
According to the “Notice”, in terms of initial listing, if the company is indeed due to the epidemicperformanceIf it can be shown that the company still meets the positioning requirements of the declared sector and the conditions for issuance and listing, and the continuous profitability or continuous operation ability has not been significantly adversely affected, the review and registration work will be carried out normally; System listings, corporate bonds and assetssecuritiesFor business such as chemical product distribution, the implementation of special-person docking, immediate review upon application, and immediate issuance upon review;M&AreorganizationIn terms of targeted relaxationMergers and acquisitionsThe conditions for the application of the “Small Amount Quick” review mechanism are relaxed, and the restrictions on the proportion of supporting funds raised to make up for current debt repayment are relaxed.
In addition, the validity period of the M&A and restructuring financial materials and the validity period of the approval documents are extended, and the issuer’s feedback, the time limit for replying to review inquiries, and the time limit for replying to notification letters are extended and extended.
“Under the influence of the epidemic, the normal operation of enterprises has been affected.Cash flowor be impacted, so it is important to provide financial support. “A small and mediumbrokerageInvestment bankers told the “Securities Daily” reporter that the above measures have made specific arrangements for optimizing the review process and relaxing the deadline to facilitate direct financing of enterprises.
“The supervision allows the extension of the validity period of financial information, which effectively solves the actual problems of the company. During the epidemic, it is indeed difficult to update financial data.” A person from an investment bank of a large securities firm told the “Securities Daily” reporter. In addition, refinancing business and other implementation personnel Docking, reporting and reviewing, and issuing immediately after reviewing are also of great help to enterprises.
“The 23 measures are largely intended to provide high-quality services for corporate financing, minimize the impact of the epidemic on enterprises, and minimize losses.” Zheng Zhigang, a professor of finance at Renmin University of China’s School of Finance, told Securities Daily In an interview, the reporter said that the IPO application of qualified companies to be listed will be pushed forward normally, and “green channel” services will be provided for refinancing, listing on the Beijing Stock Exchange, listing on the New Third Board, etc., and improving the efficiency of direct financing can alleviate the urgent needs of enterprises. However, it should be noted that these facilitation measures do not mean lowering the threshold for direct financing, but provide convenient and efficient services in the review process on the premise that the enterprise meets the requirements.
“The healthy development of the capital market requires stable expectations from listed companies, investors and other market parties. The implementation of the above measures will help stabilize market expectations and thus promote the healthy development of the capital market.” Zheng Zhigang said.
Special events for special occasions
Demonstrate regulatory flexibility and temperature
In terms of regulatory work, local securities regulatory bureaus are allowed to conduct off-site IPO guidance and acceptance; companies listed in 2022, whose performance has declined significantly due to the impact of the epidemic, will be given appropriate regulatory tolerance for issuers and relevant sponsors.
The above-mentioned investment bankers of small and medium-sized securities companies said that from the perspective of supervision, special handling of special events in special times reflects the flexibility and temperature of supervision.
In addition, in order to reduce the impact of the epidemic on institutional operations, newly established securitiesfundInstitutions can conduct on-site inspections through online video, follow-up supplementary inspections, and support companies to obtain business licenses as soon as possible after meeting the opening conditions; securities, fund and futures business institutions are allowed to delay the submission of relevant statements, and implement electronic license filing, etc.
“On the premise of maintaining effective supervision, securities firms andfund companyPostponement of relevant reports. The implementation of flexible policies fully reflects the temperature of supervision, which is conducive to the realization of normal and stable operation of industry institutions while consolidating the responsibility for epidemic prevention and control. ” said the investment banker of the above-mentioned small and medium-sized securities companies.
In order to increase the enthusiasm of securities companies to participate in resolving the liquidity risks of private enterprises, especially listed private enterprises, relevant securities companies will be given regulatory support in the calculation of risk control indicators, the establishment of private equity fund subsidiaries, product filing, and classification and rating.
In addition, the three major stock exchanges, China Settlement, various futures exchanges and other securities regulatory system units have reduced or exempted relevant fees for listed companies, exchange members, and futures operating institutions.
Improve intermediaries
Service efficiency and effectiveness
In order to guide industry institutions to play a role in helping to fight the epidemic and resume work and production, the regulatory authorities have also introduced incentive policies.For example, securities companies are encouraged to actively play the role of financing intermediaries, support areas and industries seriously affected by the epidemic to carry out equity financing and bond financing;Equity pledge、margin financingBusinesses are “flexible” to ease the liquidity difficulties of financing entities.
“Encouraging securities companies to play the role of financing intermediaries will help companies affected by the epidemic to obtain financing faster.” The above-mentioned investment banker of small and medium-sized securities companies said that it is recommended to further refine and clarify the practice arrangements of securities companies in the future, and further improve the service efficiency and effectiveness of intermediary agencies.
“In the above measures, the emphasis is on helping issuers affected by the epidemic to directly raise funds. This is a clear requirement for securities companies, law firms, and accounting firms. Relevant intermediary financial institutions should show stronger responsibility.” Li said.
In addition, the “Notice” encourages and supports self-purchasing of public funds, and guides more social funds to flow to anti-epidemic-related enterprises; encourages securities companies to set up private asset management products to meet the financing needs of related enterprises and reduce financing costs.
Chen Li believes that for public funds, the key is to establish a medium and long-term value investment concept, and to have an objective understanding of the short-term emergencies of enterprises. At the same time, for relevant intermediaries, in addition to playing a role in promoting financing, they should also improve their own quality, actively help enterprises get out of trouble, and assist enterprises in solving relevant financial problems.
(Article source: Securities Daily)