November 8, 2019 / 8:45 AM / 12 days ago

China regulator scraps profit demands for private placements on ChiNext

BEIJING/SHANGHAI (Reuters) - China is scrapping profitability requirements for private placements on Shenzhen’s start-up board ChiNext, one of several regulatory changes to encourage more firms to raise equity funding and to create a more vibrant stock exchange.

The China Securities Regulatory Commission (CSRC) said applicants no longer needed two consecutive profitable years to issue private placements on ChiNext.

CSRC also said it would encourage listed firms to find strategic investors and announced the launch of new exchange-traded derivative products.

China wants companies to raise more equity financing to reduce reliance on bank loans. A vibrant stock market could also help an economy under pressure from the U.S.-China trade war.

CSRC said on Friday it would facilitate additional financing by companies listed on both ChiNext and the STAR Market, encouraging them to introduce strategic investors.

The regulator said it approved the launch of new exchange-traded fund (ETF) options on the Shanghai and Shenzhen stock exchanges, and the rollout of CSI300 index options on the China Financial Futures Exchange.

(This story corrects to read private placements, not IPOs)

Reporting Zhang Xiaochong and Andrew Galbraith; Writing by Samuel Shen; Editing by Edmund Blair

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below