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SHANGHAI – Chinese regulators said Friday they would streamline the process of issuing equities and bonds by companies affected by the epidemic and urged brokerage and fund managers to provide more funding to virus-infected areas and sectors.
The China Securities Regulatory Commission (CSRC) promises regulatory flexibility when companies cannot meet certain requirements – such as signing documents or meeting in person – due to epidemic-related restrictions.
China is battling the largest COVID-19 outbreak in two years, hitting use and production in cities like Shanghai with a complete or partial lockdown and increasing the likelihood of an economic downturn.
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The CSRC called on the stock and futures exchanges and other organizations to “work hard to help companies go through the epidemic.”
The CSRC has said that in the case of initial public offering (IPO) verification, the profit requirement for virus-infected companies will be reduced, as long as the applicants’ activities are not considered sustainable.
In the meantime, the application process for refinancing, bond sales and asset purchases for cove-hit sectors will be expedited.
Regulators will allow companies to use electronic signatures when applying for issuance of securities, and will extend the time limit for resolving regulatory inquiries.
CSRC urges brokerages to underwrite more share and bond sales for virus-affected companies and to avoid margin calls as much as possible.
For mutual fund houses, the CSRC called on them to actively use their own funds to buy funds and channel more private capital into virus-resistant companies.
According to the statement, regulators will also expedite the approval of anti-virus-funded products. (Reporting by Shanghai Newsroom, Editing by Lewis Heaven)