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China to publish information disclosure rules on ABS issuance - sources
May 14, 2015 / 9:36 AM / 3 years ago

China to publish information disclosure rules on ABS issuance - sources

BEIJING (Reuters) - China’s central bank will soon publish rules on information disclosure for the issuance of asset-backed securities (ABS), sources with direct knowledge of the matter told Reuters.

The first regulations will be on ABS related to auto and housing mortgages, the sources said on Thursday.

The rules will require issuers to make public the statistics of the underlining assets as well as historical data on such assets, they said.

Assets related to auto and housing mortgages are relatively standard, with relatively lower risk, and thus have been selected to be the first for an expansion of China’s fledging ABS market, said one source, who spoke on condition of anonymity as he is not authorized to speak to media.The move comes after the People’s Bank of China (PBOC) announced last month that regulatory approval will no longer be required for the issuance of ABS, and issuers will only need to register to do so.

The first ABS under the PBOC’s new streamlined procedure would be issued soon after the publication of the detailed rules, the sources said.

The central bank did not immediately respond to Reuters’ request for comments.

In line with official efforts to expand the market, China’s Cabinet said on Wednesday it was increasing the country’s asset securitisation programme by 500 billion yuan (51 billion pounds).

Still, the increase appears to lag expectations unless policymakers follow through with further measures, traders said.

Market players had expected China’s ABS issuance to more than triple to 1 trillion yuan ($161 billion) this year, up from 300 billion yuan in 2014, which was in turn twice the total issued since 2005.

Reporting by Clark Li; Writing by Lu Jianxin; Editing by Nathaniel Taplin and Jacqueline Wong

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