The government of Guangzhou plans to set up a RMB 20 billion ($3 billion) rescue fund to help struggling publicly listed private enterprises, said Caixin.
Guangzhou, home to 100 A-share listed companies, is the most recent local government to roll out plans for helping cash-strapped private companies mired in the country’s pledged-share crisis starting late last year.
Local Chinese governments and financial institutions started setting up bailout funds in October as a part of the central government campaign to help stabilize the stock market. At of the end of November, local governments had rolled out special bailout funds totaling RMB 170 billion. In addition, financial institutions including brokerage firms, insurers and asset management companies launched bailout funds and bonds worth about RMB 120 billion.
The Guangzhou fund, announced on the website of the municipal government, it will expand the RMB 3 billion mergers and acquisitions fund already set up by 18 state-owned enterprises in the city. The government will direct financial institutions and social capital to participate in the expanded bailout fund, according to a government statement.