SHANGHAI, Oct 24 (Reuters) - Two funds that China set up to boost battered shares during a 2015 market crash reported on Wednesday that they had massive redemptions in the third quarter, and had no holdings in shares and bonds as of Sept. 30.
CMF FengQing Flexible Allocation Fund reported that in July-September 11.91 billion or 99 percent of its 12 billion fund units were redeemed, leaving it with 104 million units and net assets of 139 million yuan ($20 million).
E Fund RuiHui Flexible Fund said that all but 123 million of its 12 billion fund units - also 99 percent - were redeemed during the past quarter. Its net assets as of Sept. 30 were reported as 157 million yuan.
In both cases, most of their remaining net assets were in bank deposits.
The redemptions did not surprise analysts, who noted that there were heavy ones in the first quarter of this year.
The two state-backed funds, and three others, were created in July 2015 while China’s stock market was crashing, and they were given mandates to invest 40 billion yuan each in shares.
The other three have not yet published reports for the quarter ended Sept. 30.
News of the two funds’ withdrawal from the stock market comes shortly after a tumble in Chinese shares that shows the government is taking a different approach to giving support than in 2015.
The government is not pumping money into the market directly. On Friday, Beijing launched a coordinated campaign to stem the slide in share prices, encouraging various types of asset managers to launch commercially viable products to ease liquidity stress at smaller listed companies.
$1 = 6.9362 Chinese yuan Reporting by Samuel Shen and John Ruwitch; Editing by Richard Borsuk