BEIJING, Sept. 28 (Xinhua) -- China cancelled recently administrative approval requirements for non-capital bonds issuance by commercial banks to boost related financing and economic growth, reported Xinhua-run Shanghai Securities News on Wednesday.
China Banking and Insurance Regulatory Commission (CBIRC) said in its file that commercial banks should report to CBIRC or its provincial branches within 10 days after their non-capital bonds issuance, which will take effect as from October 8 this year.
Meanwhile, a shelf offering mechanism will also be applied for capital-boosting bonds of commercial banks, meaning that they are allowed to determine within the approved quotas the concrete type of bond products, issuance dates, batches and amounts without having to sell the issues at once.
Previously, commercial banks should obtain both administrative approvals from the Chinese central bank and replies from CBIRC before issuing financial bonds. The new rules will foster financial bond issuance and help stabilize the economic growth, said the report citing Wang Yifeng, financial institution rating director with CSCI Pengyuan Credit Rating Co., Ltd.
In future, it will be more convenient for commercial banks to issue financial bonds. Taking tier II capital bonds as an example, rollover issuance can be rapidly realized after maturity, helpful for commercial banks to complement capital and better serve the real economy, said industry experts.
Apart from CBIRC, Chinese central bank also stably pressed ahead with the issuance rules reform for financing bonds. On basis of the financial bonds balances management applied among nationwide large banks since this year, pilot financing bonds balances management kicked off for local banks in Zhejiang Province and Jiangsu Province.
In August, financial bonds issues grew 133.42 percent month on month to 437.1 billion yuan in China, according to Wind. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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