Financial News Agency, November 8 (Reporter Yan Jun)The market continues to discuss “shorting securities loans.” However, at this time, some shareholders of listed companies “hit the gun at gunpoint” due to securities loans and sales.

Statistics from the Financial Services Association show that only one month since the implementation of the new securities lending regulations, the effect on regulating securities lending in the market has been remarkable. As of November 7, the balance of securities lending in the entire market exceeded 66.9 billion yuan, a decrease of 7.3 billion yuan from the securities lending balance of 74.2 billion yuan before October 13, a decrease of more than 10%.

However, as the overall balance of securities loans declined, the actions of some company shareholders still raised questions in the market. For example, Jianghuai Automobile, which had been rising for 4 days, was sold by a huge amount of securities, and Gao Lin Capital is suspected of reducing its holdings in Longji Green Energy through transfinancing. Investors say “there is no fairness to speak of.”

Originally, in mature markets, securities lending has the role of improving capital utilization, increasing investment leverage, increasing market liquidity, and playing a price stabilizer. However, in the current A-share market, the scarcity of securities sources and market fluctuations have caused even more controversy in the market over the securities lending business.

Jianghuai Automobile was sold by a large securities loan

Jianghuai received a lot of attention due to large securities loans and sales. Judging from securities sales, the company sold 40.8 million securities on October 30, an increase of 2,737 times from 14,900 shares the previous day. After the sale of huge securities loans, Jianghuai Automobile stopped its fourth consecutive market, and its stock price fell 8.77% over the two days of October 31 and November 1.

On November 3, Jianghuai Automobile stated on an interactive platform that Jiangqi Holdings, the controlling shareholder of the company, had not engaged in securities financing. However, there is no explanation as to who is actually making a big sale.

Regarding the huge securities sales, investors questioned, “The market capitalization of more than 40 billion dollars, after 4 ups and downs, the reverse hand destroyed the market when securities were sold at the highest point. There is no fairness to speak of.”

Gao Hing Capital may be involved in reducing its holdings in Longji Green Energy through transformation, and was investigated by the Securities Regulatory Commission

According to Longji Green Energy's announcement for the third quarter of this year, all of the shares loaned by HHLR Management Co., Ltd. - China Value Fund, a subsidiary of Gaolin Capital, in the third quarter have already matured and returned. Currently, the company holds 4.98% of the shares and has increased its holdings. This has left many investors puzzled: As a shareholder of more than 5%, when will Hillhouse Capital reduce its holdings?

According to public information, in the first quarter of this year, Gao Lin Capital was still a shareholder holding 5.85% of the shares, with a shareholding ratio of more than 5%. By the second quarter, the shareholding ratio had dropped to 4.85%. As a shareholder holding more than 5% of shares, holdings reduction must be in accordance with regulatory regulations. “The holdings reduction plan should be reported to the stock exchange and disclosed in advance 15 trading days before the initial sale.” However, if you check out Longji Green Energy's announcement, it can be seen that Gao Lin Capital did not have any relevant holdings reduction announcements during the following period. This has raised questions in the market about whether Gao Lin Capital will use financial transfer to reduce its holdings.

In response, some industry insiders reported that on March 21, Longji Green Energy issued the “Prompt Notice for Shareholders to Participate in Transferring Business”, stating that Gaolin Capital participated in the transfer business through its shares of Longji Green Energy, lent 0.85% of its shares for a loan period of 182 days, and suggested that it may continue to lend 0.15% of its shares for the next 90 days, and indicated that this move “is not a reduction in holdings”. As a result, the number of shares held has decreased as a result of the loan. Therefore, in the interim report this year, Gao Capital held 4.85% of Longji Green Energy's shares.

However, by the third quarter of this year, Longji Green Energy announced that all of the shares loaned by HHLR Management Co., Ltd. - China Value Fund, a subsidiary of Gaolin Capital, in the third quarter had matured and returned, and the company held 4.98% of the shares. From lending securities to full repayment, the industry insiders mentioned above believe that Gao Hing Capital may have achieved a reduction in holdings through a cycle of “reducing holdings and withdrawing securities” through the “reduction of holdings and withdrawal of securities financing”.

Regulation was swift.

Longji Green Energy announced in the evening that HHLR Management Co., Ltd., the company's shareholder, received a notice issued by the China Securities Regulatory Commission. HHLR Management Co., Ltd. decided to investigate the transfer of Longji Green Energy shares in violation of restrictive regulations.

The balance of securities loans fell 10% in just one month under the new regulations

By optimizing systems related to securities lending, supervision aims to give full play to the countercyclical adjustment function of securities financing business, regulate market shorting behavior while regulating and stabilizing market capital expectations, thereby enhancing overall investment and financing confidence in the capital market.

Judging from the securities lending data, the new securities lending regulations have had a positive effect on the market securities lending code of conduct. From the perspective of market-wide securities lending, as of November 7, the balance of securities lending in the entire market was close to 67 billion yuan. The Jinshan office is the single stock with the highest securities loan balance, at 1.8 billion yuan. Huayou Cobalt and China Merchants Shekou also have securities financing balances exceeding 1 billion yuan. Across the market, 126 listed companies had securities loans of over 100 million, 65 over 200 million, and 15 listed companies with securities balances of over 500 million.

Also, looking at the data for October 13 before the new regulations, the total market securities balance was over 74.2 billion yuan, and the Jinshan office securities balance was as high as 2.1 billion yuan, including Tuojing Technology, Huayou Cobalt, China Merchants Shekou, and Zhongji Xuchuang Securities, which exceeded 1 billion yuan. In addition, there are 17 listed companies with securities balances exceeding 500 million, and 150 companies with securities balances exceeding 100 million yuan.

Comparatively speaking, the new securities lending regulations have been implemented in less than a month, significantly limiting securities lending behavior in the market. The balance of securities lending in the entire market has been reduced by more than 7 billion yuan, a drop of more than 10%.

Judging from the listed companies with large securities loans, most of them are electronics industries that have seen good gains this year, such as Jinshan Office, Tuojing Technology, and Zhongji Xuchuang. At the same time, the new energy and automobile industry chain tracks are areas where securities are widely traded, such as Ende shares, Desai Siwei, JAC, and Celis.

Investors still accuse investors of “violating fairness” by using transfinance to reduce holdings and sell huge amounts of securities when there is a sharp rise

On October 14 of this year, in response to securities financing issues that the market is concerned about, the Securities Regulatory Commission issued a notice “Adjusting and Optimizing Securities Lending Related Systems to Better Play the Role of Countercyclical Adjustment”. The regulation optimizes the securities lending business from two major aspects: the securities lending side and the lending side.

First, on the securities lending side, the margin ratio for securities loans was raised from no less than 50% to 80%, and the margin ratio for private equity investment funds participating in securities financing was raised to 100%, giving full play to the countercyclical adjustment effect of the system. Second, on the lending side, it is possible to adjust the share loans placed by strategic investors according to relevant regulations. In order to highlight the focus of listed company executives on their main business, abolish loans from special asset management plans set up by listed company executives and core employees through participation in strategic placements, and moderately limit the lending methods and proportions of other strategic investors in the early stages of listing.

In response, industry insiders pointed out that the margin ratio for securities loans has been drastically raised. This move can effectively reduce the amount of capital for securities lending. The adjustments on the loan side reflect the enhanced supervision of securities lending business by the Securities Regulatory Commission, reduced the volume of securities lending in the market, and reduced investors' concerns about some private equity funds and other investors going short through securities lending.

The regulation clearly stipulates securities lending by shareholding departments such as strategic placement and core employees on the lending side, and regulates lending methods and proportions in the early stages of listing.

However, recent phenomena such as JAC's rise and stop of 400 million dollars and huge securities loans, and some investors questioning that Gao Hing Capital has reduced its holdings in Longji Green Energy through financial transfers are still causing a lot of discussion in the market.