January 17, 2020 / 11:20 AM / 2 months ago

China securities regulator says to balance equity supply and demand this year

SHANGHAI (Reuters) - China’s securities watchdog said on Friday that it would keep equity supply and demand in balance in 2020 as it pushes for further reforms in the capital markets while containing financial risks.

The China Securities Regulatory Commission (CSRC) reiterated plans to introduce a registration-based mechanism for initial public offerings (IPOs) on Shenzhen’s start-up board ChiNext this year, according to a statement on the regulator’s website.

The U.S.-style IPO system is the basis of Shanghai’s Nasdaq-style STAR Market, which was launched in 2019, and hailed as China’s boldest capital market reform yet.

CSRC said that it would encourage the listing of companies, especially tech firms. Meanwhile, regulators will continue to promote the launch of equity funds, and expand the source of long-term capital, so as to balance fundraising and investment capital.

CSRC said it will also promote a pilot scheme for infrastructure-based real estate investment trusts (REITs), and will increase the supply of futures and options based on commodities or financial assets.

Reporting by Samuel Shen and Brenda Goh, Editing by Raju Gopalakrishnan

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