Hot Spot Focus
01 Evergrande’s problem is a case risk, and the handling has taken a key step
On December 3, China Evergrande Group disclosed an announcement that it may be unable to fulfill its guarantee liability. The Guangdong Provincial People's Government immediately summoned Xu Jiayin, the actual controller of China Evergrande Group, that night. At the request of Evergrande Real Estate Group Co., Ltd., the Guangdong Provincial People's Government agreed to send a working group to Evergrande Real Estate Group Co., Ltd. Subsequently, the "One Bank and Two Sessions" and the Ministry of Housing and Urban-Rural Development responded to the Evergrande issue.
Relevant person in charge of the People's Bank of China said that the risks of Evergrande Group are mainly due to its own poor management and blind expansion. The overseas dollar bond market is highly market-oriented, with investors relatively mature and strong identification ability, and there are clear legal provisions and procedures for handling related issues. In the short term, individual real estate companies will not affect the normal financing function of the medium and long-term market. A relevant official from the China Securities Regulatory Commission pointed out that at present, my country's real estate industry is generally developing healthily, and most real estate companies stick to their main business and operate stably.
At present, the A-share market is generally stable, with strong resilience and high activity. The default rate of the exchange bond market remains at a low level. The financial indicators of operating and financial indicators of listed housing-related companies and bond issuers are generally healthy. The spillover impact of the risk incidents of Evergrande Group on the stable operation of the capital market is controllable. A spokesperson for the China Banking and Insurance Regulatory Commission said that the Evergrande incident will not have any negative impact on the normal operation of my country's banking and insurance industry.
China Banking and Insurance Regulatory Commission will conscientiously implement relevant national policies and guide banking and insurance institutions to provide financial services to the real estate and construction industries on the premise of implementing prudent management of real estate finance. At this stage, we must focus on meeting the mortgage needs of first-home and improved housing according to different situations in various places, rationally issue real estate development loans and mergers and acquisitions loans, increase support for affordable rental housing, and promote the stable and healthy development of the real estate industry and the market. Relevant personnel from the Ministry of Housing and Urban-Rural Development said that the Guangdong Provincial Government dispatched a working group to Evergrande, which is conducive to Evergrande's risk resolution, is conducive to Evergrande's guarantee of delivery of buildings, and is conducive to protecting the legitimate rights and interests of home buyers.
"Tsinghua Financial Review" Observation
Judging from the responses of relevant departments, Evergrande's problem has been identified as a case risk. At present, my country's real estate industry has generally maintained healthy development, and the financing channels of real estate companies in the bond market remain unobstructed and orderly. The handling of Evergrande's problems has taken a key step, which is conducive to further comprehensive investigation of Evergrande's overall debt scale and effectively resolve risks; it is conducive to reducing the uncertain risks faced by upstream and downstream enterprises and related real estate companies; it is conducive to safeguarding the legitimate rights and interests of all parties and maintaining social stability.
Major Meeting
01 Fang Xinghai said that the futures law is expected to be released after the third reading next year
On December 5, Fang Xinghai, vice chairman of the China Securities Regulatory Commission, attended the 17th China (Shenzhen) International Futures Conference and delivered a keynote speech. Fang Xinghai pointed out that promoting the construction of the futures market and serving the high-quality development of the real economy mainly starts from three aspects: First, take futures legislation as an opportunity to further strengthen the construction of the rule of law in the futures market. The second is to strengthen market construction and build a diversified and open futures derivatives market system. The third is to continue to improve the futures intermediary system.
Fang Xinghai said that since 2021, the formulation of the Basic Law of the Futures Industry has made breakthrough progress. The Futures and Derivatives Law (hereinafter referred to as the "Futures Law") is expected to be officially released after the third reading in 2022 through the first and second readings. We must take the legislative framework and principles of the Futures Law as guidance, promote the improvement of institutional systems such as departmental rules and self-discipline rules, continuously consolidate the foundation for the rule of law construction of the futures market, and improve the ability and level of governing the market according to law.
should take the promulgation of the Futures Law as an opportunity to strengthen the promotion of futures market services to real enterprises, and build consensus on all parties to develop the futures market. We must support futures companies to expand financing channels and carry out cross-border operations, and encourage top futures companies that meet the conditions to go public for financing. We will strive to build a group of derivatives and commodity service companies with strong capital strength, international competitiveness, and core businesses with risk management and asset pricing services.
"Tsinghua Financial Review" Observation
Currently, the total amount of funds in my country's futures market has exceeded 1.2 trillion yuan, an increase of 44.5% from the end of 2020; in the first 11 months of this year, the cumulative trading volume and turnover of on-site futures options reached 6.919 billion lots and 536.46 trillion yuan, respectively, an increase of 28.61% and 40.27% year-on-year respectively.
Compared with the rapid development of the futures industry and futures market, the process of rule of law in futures lags relatively behind. my country has successively formulated a series of financial laws such as the People's Bank of China Law, the Commercial Banking Law, the Banking Supervision and Administration Law, the Securities Law, the Securities Investment Fund Law, the Insurance Law, the Trust Law, and the Anti-Money Laundering Law, but the Futures Law has not been issued for a long time. The current legal system is not of high level and effectiveness, trading rules and regulatory standards are not unified, and futures trading lacks basic civil legal norms, making it difficult to adapt to the development needs of the futures industry and futures market.
Rule of the market according to law is the key to the steady development of the futures market. The formulation of the Futures Law is an important measure to implement the decisions and deployments of the Party Central Committee, an important guarantee for safeguarding national financial security and preventing and resolving financial risks, and an objective need to promote the modernization of the governance system and governance capabilities on the track of the rule of law. This round of formulation of the Futures Law was launched in 2013, and it has been 8 years since this year.
02 Deputy Director of the Central Bank's Digital Research Institute Di Gang: It has taken the lead in actively exploring blockchain applications in digital RMB R&D projects
On December 5, Di Gang, deputy director of the Central Bank's Digital Currency Research Institute, said at the 18th Global Annual Meeting of the International Financial Forum that the application achievements of blockchain technology in the field of digital finance have begun to emerge. The Central Bank’s Digital Currency Research Institute has taken the lead in actively exploring blockchain applications in the research and development projects of digital RMB.
Di Gang also said that a unified distributed ledger is built based on blockchain technology in the digital RMB system. As a trusted institution, the central bank puts transaction data on the chain to ensure the authenticity and reliability of the data. Operating institutions can conduct cross-institutional reconciliation, collective account maintenance, multi-point backup, etc.
"Tsinghua Financial Review" Observation
From the perspective of application, the application achievements of blockchain technology in the field of digital finance can be divided into two parts: part is from competing for patents to competing for strength, from finding scenarios to building an ecosystem, the results of blockchain implementation are increasing, and more and more value advantages are leveraging; the other part is that blockchain technology has been implemented in cross-border payments, supply chain finance, agricultural finance, trade finance, inclusive finance, social cities, "agriculture, rural areas and farmers", people's livelihood and other fields. Some large international financial institutions are also actively expanding blockchain application scenarios, including trade finance, information sharing, foreign exchange transactions, equity transactions, etc.
Major policies
01 The China Banking and Insurance Regulatory Commission issued the "Guiding Opinions on Supporting High-level Science and Technology Self-reliance and Self-reliance in the Banking and Insurance Industry"
In order to implement the major decisions and deployments of the Party Central Committee and the State Council on insisting on taking scientific and technological self-reliance as the support for national development strategy, implement the innovation-driven development strategy in depth, improve the financial system that supports scientific and technological innovation, and promote the quality and efficiency of financial services of banking and insurance technology enterprises, the China Banking and Insurance Regulatory Commission recently issued the "Guiding Opinions on Supporting High-level Science and Technology Self-reliance and Self-reliance in the Banking and Insurance Industry" (hereinafter referred to as the "Guiding Opinions"), requiring banking and insurance institutions to conscientiously implement it in light of actual conditions.
The Guiding Opinions pointed out that we must follow the basic principles of innovation-led, market-oriented, overall coordination, and controllable risks, give full play to the positive role of the banking and insurance industry in serving scientific and technological innovation, promote the improvement of a multi-level, professional and distinctive science and technology financial system, and provide strong support for achieving high-level scientific and technological self-reliance and self-improvement
"Tsinghua Financial Review" Observation
At present, global scientific and technological progress is changing with each passing day, and the financial needs and characteristics of science and technology enterprises are changing rapidly. The "Guiding Opinions" encourage banks and insurance institutions to coordinate development and security, and accelerate the innovation of technology finance products and services on the basis of improving and detailed traditional technology finance businesses. Banking institutions are encouraged to extend the working capital loan period in accordance with the law and regulations based on the production and operation cycle of technology enterprises, and adopt more flexible interest rate pricing and interest repayment methods to help technology enterprises innovate and develop.Promote the pilot program of the first (set) and new material insurance, support regions with conditions to explore the first version of software insurance, and escort the transfer and transformation of scientific and technological achievements. In addition, banking and insurance institutions are encouraged to expand financial services for scientific and technological talents, enrich intellectual property insurance business varieties, and meet the diversified financial needs of scientific and technological innovation.
targets the characteristics of high risks and strong uncertainty in technology enterprises. On the one hand, considering that technology enterprises in the start-up stage are more in line with the risk preference for direct financing, under the premise of compliance with the law, controllable risks, and sustainable business, the "Guiding Opinions" support commercial banks' subsidiaries, insurance institutions, trust companies and other investment functions to invest in venture capital funds, government industrial investment funds, etc., to provide equity financing for the development of technology enterprises. Support asset management products to invest in equity assets including equity and income rights of unlisted technology companies in accordance with the law, so as to achieve the matching of the term of asset management products to the term of assets they invest in and the growth cycle of technology companies. Research the feasibility of establishing insurance funds to serve the national science and technology strategy special funds or other fund to support the development of science and technology, and better support the innovative development of science and technology enterprises.
On the other hand, the "Guiding Opinions" require banks and insurance institutions to improve professional internal management and risk control mechanisms. Banking and insurance institutions are encouraged to establish professional science and technology financial service organizations, cultivate a professional talent team, and improve assessment incentives and due diligence exemption mechanisms. Organize science and technology experts to participate in business review, actively explore the application of new generation information technology in the financial risk control field, pay more attention to the availability of equity investments, R&D capabilities, technical advantages, patent quality, team stability and market prospects of technology enterprises, and improve professional risk control models.
02 The China Banking and Insurance Regulatory Commission issued the "Regulations on Supervision and Administration of Insurance Group Companies"
On November 30, the China Banking and Insurance Regulatory Commission issued the "Regulations on Supervision and Administration of Insurance Group Companies" (hereinafter referred to as the "Measures") to further strengthen the supervision and management of insurance group companies, effectively prevent the operating risks of insurance groups, and promote the healthy development of the financial insurance industry. The Measures shall come into effect on the date of promulgation.
The Measures emphasize that the equity investment of insurance group companies should adhere to the principle of insurance main business, promote insurance groups to focus on the insurance main business, strengthen equity investment management, standardize business behavior, and prevent disorderly expansion of capital; insurance group companies should reduce the complexity of the equity structure of insurance group and improve the governance capabilities of insurance group companies; insurance group companies should establish an overall risk management system for the group, pay special attention to the unique risks of insurance group; investment and establishment of non-insurance subsidiaries should be able to optimize the group's resource allocation, give full play to synergistic effects, improve the overall professionalism level and market competitiveness of the group, and effectively promote the development of the insurance main business.
"Tsinghua Financial Review" Observation
As of the end of 2020, there were 13 insurance groups in my country with total assets of 22 trillion yuan. Insurance groups and their affiliated insurance companies dominate the insurance market entities. Compared with individual enterprises, the equity structure of insurance group companies is more complex, some risk points may be more hidden, and they are more likely to spread after risks occur, and may even cross-infection between sectors within the group.
insurance institutions have become increasingly common in multi-legal persons and group-based business models, especially after group-based insurance institutions, the complexity of business and risks has increased. While conducting cross-selling and business collaboration, it is urgent to improve regulatory requirements in terms of access, governance, capital and risk management, information disclosure, etc. The revised Measures of
focus on strengthening the governance and supervision of insurance group companies, requiring insurance group companies to have a concise, clear and penetrating equity structure, reasonable with the equity control level of subordinate member companies, and strengthen the main responsibility of insurance group companies for the entire group company governance.
03 The commitment system for securities and futures administrative law enforcement parties shall be implemented in 2022
On November 29, Premier Li Keqiang recently signed a State Council order to announce the "Measures for the Implementation of the Commitment System for Securities and Futures Administrative Law Enforcement Parties" (hereinafter referred to as the "Measures"), and the "Measures" shall come into effect on January 1, 2022.The CSRC simultaneously solicited public opinions on the "Regulations on the Management of Commitment Funds for Parties to Administrative Law Enforcement of Securities and Futures Administrative Law Enforcement Parties (Draft for Comments)" (hereinafter referred to as the "Measures for Commitment Funds") and the "Regulations on the Implementation of Commitment System for Parties to Administrative Law Enforcement of Securities and Futures Administrative Law Enforcement of Securities and Futures (Draft for Commitment System Implementation)" (hereinafter referred to as the "Regulations on the Implementation of Commitment System").
"Tsinghua Financial Review" Observation
"Measures" stipulate the commitment system for the parties to administrative law enforcement in the form of administrative regulations based on the summary of pilot experience. The Measures standardize the implementation of the commitment system of the administrative law enforcement parties by clarifying the basic processes, strictly limiting the scope of application, and improving the supervision and restraining mechanism, ensuring that the system is open, fair and just, protecting the legitimate rights and interests of investors, improving law enforcement efficiency, and preventing moral risks.
The Measures mainly stipulate five aspects of content. Including: clarifying the connotation and application principles of the commitment system of the parties to the securities and futures administrative law enforcement, stipulating the basic process for the application of the commitments of the parties to the securities and futures administrative law enforcement, clarifying the circumstances in which the commitments of the parties to the securities and futures administrative law enforcement are not applicable, clarifying the use and management methods of the commitment funds, and clarifying the supervision and restraining mechanism.
Compared with the "Implementation Measures for Administrative Reconciliation Pilot" formulated by the China Securities Regulatory Commission in 2015, the "Measures" further improved the relevant systems based on summarizing the pilot experience, expanded the application time, adjusted the scope of application and conditions, optimized the initiation procedures, improved the factors for determining the amount of the promised funds, and clarified the collective decision-making system.
04 State Administration of Foreign Exchange: The "Guidelines for Code of Conduct for Foreign Exchange Market Trading" is conducive to connecting with the mature rules of the international foreign exchange market
Recently, the State Administration of Foreign Exchange issued the "Guidelines for Code of Conduct for Foreign Exchange Market Trading" (hereinafter referred to as the "Guidelines for Code of Conduct for Foreign Exchange Market Trading". Wang Chunying, deputy director of the State Administration of Foreign Exchange, pointed out that the "Guidelines" focus on standardizing foreign exchange market trading behavior, and the core content is transaction management and information management. Market participants should handle customer trading instructions or orders fairly, transparently and honestly, properly eliminate or manage conflicts of interest, conduct foreign exchange proprietary trading reasonably, and shall not transfer interests, use non-public information to engage in trading activities, and shall not engage in market manipulation or fraud. Market participants should effectively identify and protect sensitive information, exchange transaction information in a manner that complies with regulations, properly preserve transaction information records and exchange information records, and fulfill information disclosure obligations to customers or the public.
"Tsinghua Financial Review" Observation
In recent years, the world has generally strengthened the governance of the foreign exchange market and promoted the more standardized operation of the foreign exchange market. The issuance of the "Guidelines" is an important measure for the construction and governance of my country's foreign exchange market and plays a positive role in promoting the development of the foreign exchange market. First, it is conducive to promoting the stable and orderly operation of the foreign exchange market; second, it is conducive to further playing the role of the foreign exchange market in serving the real economy; third, it is conducive to connecting with the mature rules of the international foreign exchange market.
Major events
01 The US SEC passed the final amendment to the Foreign Company Accountability Act. Chinese stocks listed in the US fell
The US Securities and Exchange Commission (SEC) issued a latest notice saying that it has passed temporary amendments to implement the requirements of the Foreign Company Accountability Act for information disclosure of listed companies. The bill requires foreign companies to provide audit papers for inspection by the United States, otherwise they may be ordered to delist within three years. On the evening of December 3 (Friday), Chinese stocks listed in the United States fell sharply. Choice statistics show that among the 324 Chinese stocks listed so far, as many as 187 fell by more than 5% on December 3, of which 89 Chinese stocks listed had fallen by more than 10%.
"Tsinghua Financial Review" Observation
The official announcement of the US SEC means that all policies for the supervision of Chinese companies listed in the US have been formulated and officially entered the substantive implementation stage. As an amendment to the Sarbanes-Oxley Act, the bill mainly adds provisions for the US listed companies to meet accounting regulatory requirements. If they cannot be met, the company's stock will be prohibited from trading in all securities markets in the United States (including over-the-counter markets). This will put Chinese stocks listed in the United States facing greater delisting pressure.A spokesperson for the CSRC stated that China and the United States have been cooperating in the field of audit supervision of Chinese stocks, and have also explored effective cooperation methods through pilot inspections, laying a good foundation for cooperation for both sides.
However, in recent years, some American political forces have politicized capital market supervision, suppressed Chinese companies listed in the United States for no reason, and coerced Chinese companies to delist. This is not only contrary to the basic principles of the market economy and the concept of the rule of law, but also harms the interests of global investors and the international status of the US capital market. It is a "lose more" approach and is of no benefit to anyone. Today, when the capital market is highly globalized, regulatory authorities need to deal with audit supervision cooperation in a pragmatic, rational and professional manner, forcing Chinese companies listed in the United States to delist, should not become a responsible policy option.
02 Powell said it was time to give up the claim of "temporary" inflation
Feder Chairman Powell said at a hearing on the U.S. Senate committee on November 30 that the pace of reducing the code to buy bonds may be faster than the $15 billion a month announced earlier in November. He expects the issue to be discussed at the December meeting. Fed officials have long believed inflation is "temporary".
Powell believes that "the word temporary has different meanings for different people. For many people, it has a short-term feeling. We tend to use this word to mean it will not leave a permanent mark in the form of higher inflation. I think now may be a good time to give up the word and try to explain our meaning more clearly."
"Tsinghua Financial Review" Observation
In fact, the accelerated rise in inflation and the increase in COVID-19 cases have hit many Americans' views on the development of the US economy. Data released by the World Large Enterprise Research Association showed that the consumer confidence index in November fell from 111.6 after downward revision in October to 109.5, and US consumer confidence fell to a nine-month low in November. However, Lynn Franco, senior director of Economic Indicators at the World Large Enterprise Research Association, said in a statement that expectations for short-term economic outlooks rose slightly, but expectations for employment and income outlooks fell slightly.
Editor of this article: Sun Shixuan
// Financial Micro Classroom//
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