Chinese brokerages will set aside Rmb 21 billion ($3 billion) for a rainy-day fund to help smaller listed companies weather further turbulence on the country’s markets, Caixin reports.
The Securities Association of China said in a statement that eleven brokerages have already signed up to the plan, which will pursue further funding from banks, insurance companies and state-owned enterprises.
The stated goal for the fund is Rmb 100 billion, including subsidiary asset-management plans. Financial institutions subscribed to the program will receive relending and rediscount quotas, according to China’s central bank.
The Association’s statement added that the central bank “will actively use various credit policy tools to promote bond market innovation, pushing the financial sector to better serve the real economy and improve financing availability for private companies.”