Bank chief calls for bond reform

People's Bank of China governor Zhou Xiaochuan has said large companies should be encouraged to raise money through corporate bond sales, allowing commercial banks to channel loans to more small and medium-sized firms, the South China Morning Post reported. Speaking at a forum in Beijing, Zhou advocated over the counter trading of bonds, freeing companies from having to comply with the current onerous approval requirements. Meanwhile, under another proposed bond market reform, regulators are considering allowing local governments to sell exchange-traded asset-backed securities. The securities could be backed by cash flows from infrastructure projects and supported by local government revenue.