The People's Bank of China and the China Securities Regulatory Commission held a symposium on the share buyback and major-shareholder share-increase re-lending facility, highlighting its role in supporting listed companies’ market-value management and stabilising the capital market. The facility, created in October 2024 with the China Securities Regulatory Commission and the National Financial Regulatory Administration, has been refined to reduce the self-funded proportion requirement to 10%, extend the maximum loan term to three years, and encourage banks to provide unsecured credit loans. Financial institutions reported strong demand: in 2024, listed companies disclosed nearly CNY 300bn of buyback and share-increase plans, and since the tool’s launch more than 300 listed companies have announced using bank loans for buybacks or share increases, with firms of market capitalisation above CNY 10bn accounting for over 40%. Banks indicated they will continue to improve integrated financial services for listed companies and major shareholders and view buyback and share-increase lending as a potential new business growth area.
Central Bank of the Republic of China 2025-01-19
People's Bank of China and China Securities Regulatory Commission convene symposium on share buyback re-lending after cutting self-funding to 10% and extending tenor to three years
The People's Bank of China and the China Securities Regulatory Commission discussed the share buyback and major-shareholder share-increase re-lending facility, emphasizing its role in market-value management and capital market stabilization. Established in October 2024, the facility now lowers the self-funded proportion to 10% and extends loan terms to three years, with strong demand from listed companies. Banks plan to enhance financial services for listed companies, viewing this lending as a potential growth area.