Original title: The central bank promotes the reform of SLF operation mode to meet the liquidity needs of local institutions in a timely manner
Reporter: Li Yuan
According to the official website of the central bank, the central bank held a video conference on September 23 to promote the reform of the Standby Lending Facility (SLF) operation method, requiring all branches of the central bank to attach great importance to the promotion of the reform of the SLF operation method as current important tasks. Elaborate organization and implementation.
The meeting pointed out that the SLF interest rate is the upper limit of the money market interest rate corridor. It promotes the reform of SLF operation mode and orderly realizes the electronicization of the whole process, which is conducive to improving operation efficiency, stabilizing market expectations, enhancing the stability of the banking system’s liquidity, and maintaining the stability of money market interest rates. run.
“It is necessary to actively and steadily promote the reform of SLF operation mode, optimize operation procedures, improve operation efficiency, and timely meet the reasonable liquidity needs of local corporate financial institutions in accordance with regulations, and effectively prevent liquidity risks.” The meeting pointed out.
According to the central bank’s monetary policy implementation report in the second quarter of this year, the central bank’s cumulative SLF operations were 59.1 billion yuan in the first half of this year, of which 11.6 billion were operated in the second quarter, and the balance at the end of June was 8.6 billion yuan. Give full play to the SLF interest rate as the upper limit of the interest rate corridor to maintain the smooth operation of the money market. Local corporate financial institutions provide short-term liquidity support in full on demand.
According to the central bank’s website, the central bank carried out SLF operations of 232 million yuan and 60 million yuan in July and August respectively, and the balance of SLF was 0 billion yuan at the end of August. The overnight, 7-day, and 1-month SLF interest rates are 3.05%, 3.2%, and 3.55%, respectively.
The 21st Century Business Herald reporter learned that with the approval of the Central Bank, the National Interbank Funding Center’s local currency trading system will provide eligible members of the interbank local currency market with SLF applications, confirmations, pledge contract signing, and loan contracts from September 14, 2015. Specific permissions such as signing. The notice shows that city commercial banks, rural commercial banks, rural cooperative banks, and rural credit unions have SLF application rights since the system functions are online.
In order to realize the settlement of SLF business securities (hereinafter referred to as DVP settlement) and improve the efficiency of SLF operations, in accordance with the requirements of the Central Bank, the National Interbank Funding Center SLF operating system will provide the convenient DVP settlement function for standing loans from May 17, 2017. SLF business DVP settlement is suitable for financial institutions that are direct participants of the large-value payment system to carry out SLF business with the depository bonds of the China National Debt Depository and Clearing Corporation as collateral. SLF business operations that are not direct participants of the large-value payment system or use Shanghai Clearing House’s custody bonds as collateral are not applicable to DVP settlement for the time being, and the original business process remains unchanged.
In May of this year, the National Interbank Funding Center launched a new generation of local currency trading platform SLF function. This function supports eligible financial institutions to submit SLF applications to the People’s Bank of China through the trading center’s new generation trading platform, and sign bond pledge contracts and SLF contracts with the central bank And so on.
On July 9 this year, the National Interbank Funding Center issued the “Standing Lending Facilitation System Operation Guidelines (Revised in July 2021)” that the DVP operation process is suitable for borrowing financial institutions to use CCDC’s custodial bonds as collateral and SLF business for which DVP settlement procedures have been processed with CCDC.
On the same day, the “Notice on Supporting Small and Medium-sized Financial Institutions’ Standing Loan Facilitation Business Voucher Payment Settlement” pointed out that in order to realize the DVP settlement of SLF business of all small and medium financial institutions and improve the efficiency of SLF operations, in accordance with the requirements of the central bank,From now on, the SLF system of the National Interbank Funding Center has added support for small and medium financial institutions (referring to financial institutions that are not directly participating in the payment system) to apply for DVP-settled standing lending convenience functions.The payment system directly participates in the financial institution to handle the DVP settlement of SLF business in accordance with the above operation guidelines.
“Through system transformation, small and medium financial institutions can borrow SLF in the form of DVP, which improves the efficiency of SLF operation.” The central bank said in the monetary policy implementation report in the second quarter of this year.
The above-mentioned latest operating guidelines also show that the National Interbank Funding Center has opened the SLF application authority for the city commercial banks, rural commercial banks, rural cooperative banks, and rural credit cooperatives that have been connected to the local currency transaction system of the transaction center;If it is not connected to the local currency trading system of the trading center, the National Interbank Funding Center will go through the networking procedures and open the SLF application authority for it on the recommendation of the provincial branch or branch of the pilot city where the institution is located.
Note: This interface can check whether the trader has SLF permission under the self-employment identity
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Editor in charge: Chen Jiahui
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