PBOC sets up bond-market swap facility for non-bank redemptions
Briefing by News4U · First published
Sina Finance reported that the central bank will lend Treasury bills to major asset managers facing large redemptions so they can buy back their own funds’ bonds and pledge them as collateral.
Sina Finance reported that on 26 October the People’s Bank of China announced the creation of the Bond Market Non-bank Swap Facility (BNSF) to support systemically important bank wealth-management subsidiaries and public-fund managers facing large-scale redemptions. [1]
Under the scheme, eligible institutions may borrow central-bank bills from the PBOC, use the bills for repo financing, purchase the redeemed funds’ eligible bonds or shares, and pledge those assets to the central bank. [1]
PBOC Governor Pan Gongsheng said the tool, to be set up jointly with the NFRA and CSRC, aims to build a bond-market stability mechanism. [1]
Sources
- 中国人民银行设立债市非银大额赎回互换便利
Sina Finance · · Full text