China vows to hurry setup of int'l board, Over-the-Counter market

14:44, September 02, 2010      

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China Securities Regulatory Commission (CSRC) will actively study the mechanism for overseas enterprises issuing yuan bonds and stocks on the Chinese mainland to promote the construction of an international board, according to Yao Gang, deputy chairman of the CSRC.

"The CSRC will next promote the healthy development of a capital market through promoting the construction of an international board and the OTC(Over-the-Counter) market, supporting the development of innovative enterprises and small and medium-sized enterprises as well as increasing the proportion of direct financing," Yao said.

Although China has nearly 2,000 listed companies after 20 years of capital market development, a large number of joint-stock companies still cannot meet the conditions of listed companies.

Yao pointed out that the demand of these companies to enter the capital market and seek development opportunities requires China to construct the OTC market in order to provide a platform of stock circulation and capital service for those enterprises that cannot meet the conditions of listed companies.

Meanwhile, Yao also proposed to increase the proportion of direct financing beginning from the bond market. As the current development of China's direct financing and indirect financing is very uneven, it is no longer enough only to focus on equity financing to increase the proportion of direct financing.

Currently, the balance of the credit bond markets in China including corporate bonds, enterprise bonds, short-term financing bonds and medium-term notes, is about 3.5 trillion yuan, far lower than the 20 trillion yuan market value of the stocks.

By People's Daily Online


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