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SZSE Facilitates the Issuance of a Batch of Epidemic Prevention Special Bonds

Date: 2020-02-25

Since the first innovative corporate bond supporting epidemic prevention and control was quickly given the green light on February 4, SZSE continued to improve the “green channel”, solved new problems and met new needs in its work in a timely manner, and meticulously implemented supporting measures. SESE has completed the review of five new fixed income products that shall raise funds for epidemic prevention and control, with the scale of financing reached CNY14.6 billion, and completed the issuance of 5 fixed income products that were adjusted to support epidemic prevention and control, with a total financing of CNY9 billion.

 

Improving the Special Working Mechanism and Implementing the “Green Channel” of Bond Review

 

SZSE thoroughly investigated the financing needs of issuers and established a working mechanism where a specific team was created and specific persons designated to handle fixed income products review and related issues for epidemic prevention and control. We quickly responded to market consultation needs, and strengthened business communication and coordination. At the same time, we optimized the review process, reviewed the fixed income products for epidemic prevention and control upon reporting, and provided “green channel” services in an all-round way. China Railway 11th Bureau Group Co., Ltd. and China Railway 14th Bureau Group Co., Ltd., subsidiaries of China Railway Construction Corporation Limited (CRCC), participated in the construction of Huoshenshan Hospital and two mobile cabin hospitals in Wuhan International Convention & Exhibition Center and China (Wuhan) Cultural Convention and Exhibition Center, and China Railway 18th Bureau Group Co., Ltd., also a CRCC subsidiary, took the lead in the reconstruction of Tianjin version of “Xiaotangshan Hospital”. Learning that in order to support the construction of the project construction of subsidiaries, CRCC planned to make full use of supply chain financial asset backed securities to provide fund sources for the development of middle, small and micro enterprise among its suppliers in hardest-stricken areas, SZSE accelerated the processing of relevant applications through the “green channel” and issued the letter of no objection within only 2 working days to fully support the epidemic prevention and control of state-owned enterprises.

 

SESE also provided “green channel” services to enterprises including Wuhan Sishui, the issuer of the first approved innovative corporate bond supporting epidemic prevention and control in Hubei Province, Sichuan Commercial Investment Group Limited Liability Company that is responsible for procurement, production, storage, sale and distribution of epidemic prevention materials in Sichuan Province, Vanke that supported the financing of SME suppliers in Hubei, and BAIC Capital that provided logistical support for areas seriously affected by the epidemic.

 

Deepening the One-stop Issuance Service and Improving the Efficiency of Product Issuance and Listing

 

To support issuers in responding to the impact of the epidemic in a timely manner, SZSE met what the market needs and solved what the market encounters. We flexibly handled some of the issuing difficulties of issuers affected by the epidemic, and further improved the one-stop service for the issuance, registration and listing of fixed income products. On February 6, understanding that Guangxi Construction had financing needs for epidemic prevention and control, but could not submit some of its issuance and listing materials as required due to the impact of the epidemic, SZSE thus cooperated with the issuer, lead underwriter Sealand Securities and other parties to handle this appropriately. We fully assisted and supported the issuer to initiate the issuance quickly, allowing the regulatory flexibility of “keeping on record first and then supplementing materials”, and completed all the preparations for the issuance within one working day. On February 7, the first special bond for epidemic prevention and control was successfully issued in the bookkeeping way on the exchange market.

 

At present, enterprises that have completed the bookkeeping for the issuance of products for epidemic prevention and control also include State Development & Investment Corp., Ltd. (SDIC) that raised funds for subsidiaries to produce epidemic prevention materials, Changjiang Securities (registered in Wuhan) that is significantly affected by the epidemic, China Great Wall Securities that issued the first epidemic prevention bond in SZSE among securities companies, and Shenzhen Metro that provided financing to support rail traffic epidemic prevention and control.

 

Releasing Q&As on Targeted Business and Taking Multiple Measures to Strengthen the Security during the Epidemic Fight

 

On February 10, after fully understanding the needs of main market players, SZSE timely issued the Q&As on Fixed Income Review and Issuance Business on SZSE during the Epidemic Fight to clarify the relevant arrangements for product review and issuance business in this special period. Where the financial report quoted in the application documents cannot be updated in time due to the epidemic, applicants may apply for extension of the validity period of the financial report. SZSE suspended the calculation of the response time limit and the overdue response time limit for fixed income product review business feedback, and the deadline triggered upon the expiration of the overdue response time limit, as well as the validity period of CSRC’s approval of publicly-issued corporate bonds and of the letter of no objection for private corporate bonds and asset-backed securities. The explanation letters can be issued first and relevant work can be carried out first if the relevant signatures and seals cannot be obtained due to the epidemic, followed by timely submission of supplementary signatures, seals, and so on. In addition, SZSE made full use of the electronic office and made every effort to secure technical support for issuers and intermediaries to handle all kinds of fixed income business through the online system.

 

Since the outbreak of COVID-19, by firmly implementing the instructions of the General Secretary Xi Jinping and policies and plans made by the CPC Central Committee and the State Council, SZSE actively implemented requirements of the Notice on Further Strengthening Financial Support for the Prevention and Control of COVID-19 of five ministries and commissions including the PBOC and the Notice on Extending the Time Limit for Approval of Corporate Bonds to Support the Prevention and Control of COVID-19 of the CSRC, and made specific arrangements according to the actual needs of main market players in this special period. We took the initiative to communicate, implemented the regulation with warmness and consideration, followed rules of the market and provided convenient services. We handled special issues with special methods, and urgent issues as quickly as possible to secure the financing needs of enterprises for epidemic prevention. We worked together with main market players with united strength and concerted efforts to make positive contributions to winning the battle of epidemic prevention and control.

Since the first innovative corporate bond supporting epidemic prevention and control was quickly given the green light on February 4, SZSE continued to improve the “green channel”, solved new problems and met new needs in its work in a timely manner, and meticulously implemented supporting measures. SESE has completed the review of five new fixed income products that shall raise funds for epidemic prevention and control, with the scale of financing reached CNY14.6 billion, and completed the issuance of 5 fixed income products that were adjusted to support epidemic prevention and control, with a total financing of CNY9 billion.