The head of the relevant department of the China Securities Regulatory Commission answered questions from reporters on recent work related to stabilizing market stability expectations
The Zhitong Finance App learned that on November 2, heads of relevant departments of the China Securities Regulatory Commission answered questions from reporters about recent work related to stabilizing market stability expectations. The person in charge said that recently, the Securities Regulatory Commission plans to make the following adjustments and optimizations to share repurchases (referred to as protected plate repurchases) as necessary to protect the company's value and shareholders' rights: First, adding a “breakout” of the stock price as one of the situations where a protective plate repurchase can be carried out, stipulating that the “six months have passed since the company's stock listing has completed six months” restriction, and abolish restrictions that cannot be declared during the opening and closing pooled bidding stages of protected disk repurchases, etc. Second, listed companies within 36 months of listing are required to strictly and earnestly fulfill the measures to stabilize stock prices in their listing commitments when their stock prices hit a protected repurchase situation. Third, listed companies with overfunded funds are required to promptly implement repurchases when they are involved in disk repurchases. Fourth, listed companies are required to clearly include a certain percentage of funds in the annual cash dividend plan; listed companies with overraised capital are required to include a certain percentage of the overfunded funds in the special repurchase fund and earmarked for share repurchase cancellation; and the proceeds from selling protected repurchase shares through centralized bidding are required to be included in the special repurchase fund.
The original text is as follows:
The heads of relevant departments of the China Securities Regulatory Commission answered questions from reporters on recent work related to stabilizing market stability expectations
1. Today, the financial management department held a symposium to make arrangements to make full use of the two structural monetary policy tools. What are the considerations of the Securities Regulatory Commission for follow-up work?
A: In September 2024, the People's Bank of China, together with the Securities Regulatory Commission and the General Financial Supervisory Authority, launched two new monetary policy instruments: securities, funds, and insurance company exchange facilitation and special reloans for stock repurchases to increase holdings. Over the past two years, market players such as securities companies, fund management companies, and listed companies have responded positively, and the two instruments have worked well. By the end of October this year, two batches of exchange facilitation operations had been carried out, with 28 securities companies and fund management companies participating, totaling 105 billion yuan. 902 listed companies across the market have already disclosed 1,110 repurchase loan announcements. In addition to the additional holdings loans applied for by two state-owned capital operating companies, China Guoxin and China Chengtong, the maximum loan application limit has now accumulated about 440 billion yuan. The establishment and implementation of the two monetary policy instruments played an important role in introducing incremental capital into the market, revitalizing institutional assets, and promoting the improvement of the internal stability mechanism of the market.
Today, the People's Bank of China announced that it will launch the third batch of convenient exchange operations for securities, funds, and insurance companies. The stock repurchase and reloan policy will be changed from a phased arrangement to a long-term institutional arrangement, and the reloan interest rate will be reduced to 1%. We will work with the People's Bank of China to organize relevant market players to make full use of these two tools and work together to play a supporting role in stabilizing the market.
The first is to expand the scope and funding amount of institutions participating in the exchange facilitation business. Following applications from relevant agencies, the Securities Regulatory Commission and the People's Bank of China have agreed to carry out the third batch of convenient exchange operations with 31 securities companies and fund management companies. The application amount exceeds 100 billion yuan, and operations have recently begun. The Securities Regulatory Commission will continue to urge securities companies and fund management companies to strengthen compliance risk control management, give full play to their professional investment capabilities, and better stabilize the capital market.
The second is to increase the coverage rate of special reloans to repurchase shares and increase holdings of listed companies. The Securities Regulatory Commission will guide the launch of more iconic cases with strong market influence, such as weighted index companies and leading technology stocks. At the same time, listed companies that have disclosed plans to repurchase loans to increase their holdings are urged to speed up implementation. Companies that have already applied for loans are stepping up their repurchase implementation efforts, continuing the current good momentum of loan repurchases and increasing their holdings, and contributing positively to the stability of the capital market.
2. Under the call and impetus of the regulatory authorities, many listed companies have actively carried out share repurchases in recent years. What is the overall implementation status of repurchases by listed companies? What are the next considerations in supporting share repurchases of listed companies and optimizing repurchase rules?
A: Carrying out share repurchases is an important tool for listed companies to manage market value. It is also an important way for listed companies to stabilize their own stock prices and show and convey their development prospects and confidence. In December 2023, the Securities Regulatory Commission revised the “Listed Company Share Repurchase Rules” to improve the convenience of share repurchases and improve the normalized institutional arrangements for share repurchases of listed companies. The overall number of repurchases is on the rise. In the first 10 months from 2024 to 2026, the enthusiasm of listed companies to repurchase shares increased steadily. The cumulative amount of repurchase plans disclosed by the Shanghai and Shenzhen markets and the actual implementation amount increased by 50% compared to the previous three years (2021-2023). In the first 10 months of this year, 645 listed companies in the Shanghai and Shenzhen markets disclosed 700 shares repurchase plans of 237.7 billion yuan, of which the repurchase and cancellation amount was 115 billion yuan, accounting for nearly 50%. 747 companies actually implemented repurchases of 134.5 billion yuan. The amount of the repurchase plan amount, actual repurchase amount, repurchase cancellation amount and share all reached record highs.
In order to further improve the convenience of listed companies to carry out share repurchases and give full play to the market stabilizing function within the market, after extensive and in-depth research, the Securities Regulatory Commission recently plans to make the following adjustments and optimizations to repurchase shares as necessary to protect the company's value and shareholders' rights and interests: First, adding a “breakout” of the stock price as one of the situations where protected disk repurchases can be carried out. It is stipulated that the “six months have passed since the company's listed shares have expired” restrictions on protected disk repurchases, etc., which cannot be declared during the opening and closing pooled bidding stages. Second, listed companies within 36 months of listing are required to strictly and earnestly fulfill the measures to stabilize stock prices in their listing commitments when their stock prices hit a protected repurchase situation. Third, listed companies with overfunded funds are required to promptly implement repurchases when they are involved in disk repurchases. Fourth, listed companies are required to clearly include a certain percentage of funds in the annual cash dividend plan; listed companies with overraised capital are required to include a certain percentage of the overfunded funds in the special repurchase fund and earmarked for share repurchase cancellation; and the proceeds from selling protected repurchase shares through centralized bidding are required to be included in the special repurchase fund.
In the next step, we will urgently revise the “Listed Company Share Repurchase Rules” on the basis of in-depth research and verification to enhance the binding power of protected disk repurchases. Before the rules are officially revised, the Securities Regulatory Commission will increase coordination and cooperation with relevant parties to support, encourage, and supervise eligible listed companies, especially important index component companies and leading technology stock companies, to actively implement share repurchases in accordance with the above requirements and in line with their own reality, and continue to do a good job in market value management.
3. Earlier, the regulatory authorities announced the launch of active ETFs. What is the current status? What are the next work considerations in terms of diversifying market investment tools, etc.?
A: An active ETF is a public fund product where fund managers rely on professional investment and research capabilities to independently carry out stock selection, timing, and allocation, without the goal of tracking specific indices. It also has the characteristics of active general fund management and flexible and transparent ETF transactions. It can meet the needs of investors with different risk preferences and continue to introduce incremental capital into the market. Since I announced the launch of active ETFs in June of this year, fund companies have been actively reporting. The first batch of 18 active ETFs was registered on October 19, and fundraising began on October 23. The overall fundraising trend is good. As of November 2, the total amount raised has exceeded 35 billion yuan. Of these, 16 products have reached the upper limit of a single fundraising scale of 2 billion yuan and have ended fundraising.
In the next step, the Securities Regulatory Commission will guide and encourage 18 active ETFs that have already been raised to speed up investment and position opening. At the same time, we will continue to increase the supply and innovation of equity fund products to support the countercyclical layout of fund managers. Launch more new index stock ETFs to enrich in-market investment tools. Research and launch multi-asset index funds, such as a constant ratio of shares and bonds, to enrich OTC medium- and low-volatility products to better meet the investment needs of different investors. Fund managers are encouraged to issue more floating rate funds to further strengthen the binding of fund managers and holders' interests.
4. In terms of making good use of the countercyclical adjustment function of securities financing and securities lending business, what are the recent considerations of the Securities Regulatory Commission?
Answer: Securities financing is one of the important basic systems in the capital market. It has a positive effect on calming irrational fluctuations, promoting price discovery, attracting medium- to long-term capital to enter the market, and meeting investors' financing needs. In January 2026, according to the market situation at the time, the Shanghai and Shenzhen North Stock Exchange raised the financing guarantee ratio from 80% to 100%, which played a positive role in reducing the accumulation of leveraged risk in the procyclical cycle, promoting rational trading, and preventing and controlling risks in advance. Recently, financing balances and trading activity have declined markedly, and the overall level of leverage has stabilized. In order to stabilize the capital market, boost investor confidence, and promote the functioning of the securities lending business, the Securities Regulatory Commission will work with the stock exchange to guide securities companies to conduct comprehensive research on risk control indicators such as financing deposit ratio, conversion rate of securities that can be covered by margin, and maintenance guarantee ratio, and further optimize them to maintain flexibility. On the basis that risk is generally manageable, according to legal countercyclical adjustment arrangements, financing space is moderately released, existing capital is revitalized, and market liquidity is enhanced.
Investors should continue to uphold the concept of rational investment and make rational use of financing instruments according to their own risk tolerance. The Securities Regulatory Commission will continue to urge securities companies to effectively strengthen risk management and protect the legitimate rights and interests of investors.
This article was selected from the “China Securities Regulatory Commission's official website”, Zhitong Finance Editor: Xu Wenqiang.