On October 18, with the theme of "Trust and Confidence-Discussing Financial Openness and Cooperation". The 2024 Financial Street Forum Annual Conference with the theme of "Stable Development of Sharing Economy" opened in Beijing. The event brought together government leaders, representatives of financial institutions, venture capital experts and a number of scientific and technological innovation enterprises to discuss how to promote industrial transformation and upgrading through scientific and technological innovation and cultivate new quality productivity. What were the key messages released at the meeting? Jingtai interprets it for you.

Pan Gongsheng, Governor of the People's Bank of China

It is expected that the LPR interest rate will be cut next week and the RRR may be cut before the end of the year

At the meeting, Pan Gongsheng gave a detailed introduction to the specific implementation of the latest package of incremental monetary policy. Regarding the RRR and interest rate cuts, the reserve requirement ratio was lowered by 0.5 percentage points on September 27, and it is expected that by the end of this year, depending on the actual situation of market liquidity, it will be further reduced by 0.25 to 0.5 percentage points. In addition, the open market 7-day reverse repo rate was cut by 0.2 percentage points, and the medium-term lending facility (MLF) rate was also lowered by 0.3 percentage points from 2.3% to 2%. Then, on October 18, major commercial banks announced that they would reduce deposit rates, and Pan Gongsheng predicted that the loan prime rate (LPR) released next Monday (October 21) would also be lowered by 0.2 to 0.25 percentage points.

It is worth noting that the central bank also disclosed the latest progress of two monetary policy tools to support the capital market: securities, funds, insurance company swap facilities (SFISF) and stock buybacks to increase holdings and reloans. Up to now, 20 securities and fund companies have been allowed to participate in the swap facilitation operation, and the first batch of applications has exceeded 200 billion yuan. From now on, the central bank will start operations according to the actual needs of participating institutions, aiming to promote the stable development of the capital market. At the same time, the initial amount of special refinancing is 300 billion yuan, the annual interest rate is 1.75%, and the term is one year, which can be extended according to the situation.

Pan also highlighted three major considerations for the central bank when formulating the above-mentioned policy measures. First of all, considering the needs of the current economic operation, it is necessary to implement strong macroeconomic aggregate support policies. Second, in the face of outstanding problems in economic operation, especially the challenges of the real estate market and capital market, it is necessary to introduce targeted policy measures to deal with them. Finally, from the perspective of macroprudential management, the central bank must continue to observe and assess financial market risks, and take timely measures to prevent or mitigate the cumulative effects of risks.

Li Yunze, Director of the State Administration of Financial Regulation

Support insurance institutions to set up new securities investment funds

At the annual meeting of the Financial Street Forum, Li Yunze reiterated the importance of supporting qualified insurance institutions to set up private securities investment funds to enhance market stability and increase market access. This move aims to effectively meet the financing needs of enterprises and promote the healthy development of small and micro enterprises.

Under the repeated advocacy of regulators, it is expected to witness more insurance funds entering the capital market through private securities investment funds in the future. This measure not only provides insurance institutions with new investment channels and improves the efficiency of capital use, but also lays the foundation for the steady development of the capital market.

For insurance institutions, the introduction of private securities investment funds means more investment options, which helps to diversify risks and diversify asset portfolios. Due to its high flexibility and operability, private securities investment funds can help insurance institutions manage their funds more efficiently, thereby increasing investment returns. For the capital market, insurance institutions, as providers of long-term funds, will inject more long-term funds into the market and promote the stable growth of the market by participating in the market through private securities investment funds.

The creation of this structural monetary policy tool provides insurance institutions with a new way to efficiently use existing assets, which helps to "revitalize the stock and make good use of the increment". This can not only give full play to the advantages of "long cycle, high stability and large scale" of insurance funds, but also enhance the ability of insurance funds to obtain medium and long-term stable returns.

Wu Qing, Chairman of the China Securities Regulatory Commission

Listed companies have not seen the phenomenon of "piling up to reduce holdings" and a large number of illegal holdings

In his speech, Wu Qing emphasized that it is necessary to accelerate the implementation of the guidance on the entry of medium and long-term funds, actively develop equity public funds, and put forward specific solutions for different obstacles to the entry of medium and long-term funds, and build a policy framework to support long-term investment. At present, the swap facilitation tool launched by the central bank has begun to accept applications from financial institutions, and the China Securities Regulatory Commission has also approved 20 securities and fund companies to participate in the swap facilitation project. In addition, the CSRC will assist the PBOC in promoting the effective implementation of the refinancing policy tool for share buybacks, which will introduce new incremental funds to the A-share market.

Wu Qing also pointed out that improving the quality of listed companies is the key. He called on and supervised listed companies to improve their corporate governance mechanisms, improve operational transparency, increase dividends and buyback activities, and earnestly fulfill their market value management responsibilities, so as to enhance the company's investment value and bring long-term returns to investors.

In response to the general concern in the market, Wu Qing said that according to statistics, whether in the past year or in recent weeks, there has been no concentrated reduction of holdings by listed companies or a large number of illegal reductions. In the future, the China Securities Regulatory Commission will strengthen the all-round supervision from issuance and listing, information disclosure, share reduction to delisting, especially the necessary regulation of the behavior of the "key minority" such as major shareholders, so as to protect the legitimate rights and interests of small and medium-sized investors, make financing behavior more standardized, and the investment environment more healthy.

In terms of the strategy of supporting the development of emerging productive forces, Wu Qing said that he will focus on supporting the development of high-quality innovative enterprises, and reform and optimize the issuance and listing process by enhancing the inclusiveness and adaptability of the system. At the same time, we will actively promote the implementation of the newly released "Six Mergers and Acquisitions" policy, and launch a series of typical cases as soon as possible to promote the healthy development of the capital market.