Securities regulators have mapped out rules to pilot a program allowing securities brokerages to re-lend borrowed money and securities to finance margin trading.
The new move is set to further boost fledging yet fast-growing margin trading in the mainland's stock market, but could further pressure a market that is retreating toward the psychologically important level of 2000 points, analysts say.
The China Securities Regulatory Commission issued a notice on Monday allowing the Shanghai and Shenzhen stock exchanges to start the program, instructing them to choose the right time to launch it, initially on a trial basis.
Under the pilot, securities houses are allowed to re-lend money and securities borrowed from lenders, insurance companies and mutual funds to their clients in margin trading.
China Securities Finance Co has been set up, with registered capital of 12 billion yuan ($1.89 billion), to lend to the brokerages.
The first batch of 11 securities brokerages has got the green light to conduct re-lending business, according to Shanghai Securities News.
Local court accused of counterfeiting withdrawal notice in Dalian Wal-Mart case
Sina Microblog
Tencent Microblog
Feedback
RSS
