China’s central bank, the People’s Bank of China (PBOC), has conducted the first operation of the Securities, Funds, and Insurance Companies Swap Facility (SFISF), marking a significant step in stabilizing the nation’s capital market. The initial operation amounted to 50 billion yuan ($7.04 billion), the PBOC announced on Monday.
The SFISF, established on October 10 with an initial scale of 500 billion yuan, is designed to support the healthy and stable development of China’s capital market. This facility enables eligible securities, funds, and insurance companies to use their assets—such as bonds, stock exchange-traded funds, and constituent stocks of the CSI 300 Index—as collateral to obtain highly liquid assets like treasury bonds and central bank bills.
Last Friday, the PBOC launched the SFISF, approving a total of 20 securities and funds companies for participation. The first group of application quotas exceeded 200 billion yuan, highlighting strong interest from financial institutions in utilizing the new facility.
On Monday, China International Capital Corporation Limited, a leading investment bank, announced that it had completed a transaction through the SFISF. This milestone indicates active engagement from market participants and underscores the PBOC’s commitment to leveraging financial institutions in bolstering market stability.
Reference(s):
cgtn.com
