For those of you who might be interested, below is a cheat sheet of sorts regarding the announced policy change by the Chinese PBoC. Shout out to the team here at Z-Ben Advisors. They do all the heavy lifting. I'm nothing more than a glorified salesman.
cc LynAlden (npub1a2c…w83a) james (npub1cj9…0efa) preston (npub1s5y…6q7z)
The announcement measures include:
1. 50bps cut on RRR. A further 25 to 50bps cut before the end of the year will be depending on economic conditions.
2. 20bps cut on 7-day repo rate.
3. A new stock market support facility (a swap program with brokers, insurers, FMCs for A-share investments); a special-purpose relending program for the banks to provide lending to listed companies and their major shareholders for buybacks.
4. 50bps cut on the outstanding mortgage rate. The downpayment ratio for second home is cut to 15% from 25%.
5. CSRC to announce supportive policies on long-term capital’s A-share investments and listed companies’ M&A activities.
6. CSRC to further optimize equity fund registration and promote broad market-based passive fund innovation.
7. NFRA to arrange the core tier-1 capital increase of the 6 large banks.
8. NFRA to expand its commercial banks’ subsidiary financial institutions’ equity investment pilot.
9. PBoC to support commercial banks buying land from property developers.
10. Optimizing the affordable housing relending program. PBoC’s share of capital commitment in the 300bn program is increased to 100% from 60%.
11. Corporate lending renewal policies.
Not a material change to the monetary policy framework.
Nothing on property developer bailout.
The A-share market support facility is interesting, but we need to wait for the actual rules, which will specify its size and terms. But this should further boost the ETFs.
NFRA’s bank capital increase and CSRC’s M&A encouragement are the things to watch.
Will see if MoF will do a heavyweight press conference soon.
Edit: Pan added just now: as for the swap facility with brokers, insurers and FMCs, the phase-one quota is RMB500bn. Accepted collateral include bond, equity ETF and CSI300 index’s underlying stocks. Institutions will receive treasuries and central bank notes for A-share investments. PBoC is open to further expansion of the facility.
Pan also said they are studying the possibility of a stabilization fund when answering a reporter.
CSRC chairman said CSRC will further support Central Huijin’s buying.
prc30 / Peter Alexander
npub1yy…4kawc
2024-09-24 03:31:36
Author Public Key
npub1yy3uc7y85faxy5cwq8f574yda3j9457p7r9h2ymlkwlx6lp8f4vsy4kawcPublished at
2024-09-24 03:31:36Event JSON
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"content": "For those of you who might be interested, below is a cheat sheet of sorts regarding the announced policy change by the Chinese PBoC. Shout out to the team here at Z-Ben Advisors. They do all the heavy lifting. I'm nothing more than a glorified salesman. \n\ncc nostr:npub1a2cww4kn9wqte4ry70vyfwqyqvpswksna27rtxd8vty6c74era8sdcw83a nostr:npub1cj94enk44kn5mvrcma4sp7jnlsgnn4em7rk3dh3jt4fzyqs3m02s560efa nostr:npub1s5yq6wadwrxde4lhfs56gn64hwzuhnfa6r9mj476r5s4hkunzgzqrs6q7z\n\nThe announcement measures include:\n\n1.\t50bps cut on RRR. A further 25 to 50bps cut before the end of the year will be depending on economic conditions. \n\n2.\t20bps cut on 7-day repo rate.\n\n3.\tA new stock market support facility (a swap program with brokers, insurers, FMCs for A-share investments); a special-purpose relending program for the banks to provide lending to listed companies and their major shareholders for buybacks.\n\n4.\t50bps cut on the outstanding mortgage rate. The downpayment ratio for second home is cut to 15% from 25%. \n\n5.\tCSRC to announce supportive policies on long-term capital’s A-share investments and listed companies’ M\u0026A activities. \n\n6.\tCSRC to further optimize equity fund registration and promote broad market-based passive fund innovation. \n\n7.\tNFRA to arrange the core tier-1 capital increase of the 6 large banks. \n\n8.\tNFRA to expand its commercial banks’ subsidiary financial institutions’ equity investment pilot. \n\n9.\tPBoC to support commercial banks buying land from property developers. \n\n10.\tOptimizing the affordable housing relending program. PBoC’s share of capital commitment in the 300bn program is increased to 100% from 60%. \n\n11.\tCorporate lending renewal policies. \n\nNot a material change to the monetary policy framework. \n\nNothing on property developer bailout. \n\nThe A-share market support facility is interesting, but we need to wait for the actual rules, which will specify its size and terms. But this should further boost the ETFs. \n\nNFRA’s bank capital increase and CSRC’s M\u0026A encouragement are the things to watch. \n\nWill see if MoF will do a heavyweight press conference soon. \n\nEdit: Pan added just now: as for the swap facility with brokers, insurers and FMCs, the phase-one quota is RMB500bn. Accepted collateral include bond, equity ETF and CSI300 index’s underlying stocks. Institutions will receive treasuries and central bank notes for A-share investments. PBoC is open to further expansion of the facility. \n\nPan also said they are studying the possibility of a stabilization fund when answering a reporter. \n\nCSRC chairman said CSRC will further support Central Huijin’s buying. \n",
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