PBOC Launches $112 Billion Swap Facility to Boost Markets; Chinese Stocks Jump 3.7%

Oct 18, 2024, 03:11 AM

China's central bank, the People's Bank of China (PBOC), along with the National Financial Regulatory Administration (NFRA) and the China Securities Regulatory Commission (CSRC), has launched new measures to bolster the capital markets and support economic growth. The PBOC officially kicked off a specialized re-lending facility that provides funding for listed companies and major shareholders to buy back shares and increase holdings. The Securities, Funds, and Insurance Company Swap Facility (SFISF) has been launched, with the first batch of application quotas exceeding 200 billion yuan (approximately $28.1 billion). The total funding schemes amount to 800 billion yuan (about $112 billion). PBOC Governor Pan Gongsheng announced that documents on stock repurchase and increasing special re-lending tools will be released, aiming to boost market confidence and promote ongoing economic revival and growth. The PBOC has approved more than 20 securities and fund companies, including E Fund and CICC, for participation in the swap facility operation. Notably, the PBOC does not directly fund the swap facility. Following these announcements, Chinese stocks advanced, with the CSI 300 Index gaining as much as 3.7%.