Caifinance reported on October 21st (Reporter Gao Ping) that after the policies related to share buyback and stake increase re-lending were introduced, many banks promptly implemented them. As of now, including Industrial and Commercial Bank of China, Bank of China, China Construction Bank, CM Bank, China Citic Bank Corporation, and many other banks announced the landing of the initial batch of share buyback and stake increase re-lending business today. Some major banks have indicated that they have reached cooperation intentions with nearly a hundred listed companies.

Industry experts told Caifinance reporters that share buyback and stake increase re-lending can to a certain extent improve the liquidity of corporate funds, and funds may gradually enter the capital market in an orderly manner, helping inject liquidity into the market and stabilize market expectations.

Initial batch of multiple banks' share buyback and stake increase loans landing.

Since October 18th, after the central bank announced the official launch of share buyback and stake increase re-lending, 21 national financial institutions have been able to grant relevant loans to eligible listed companies and major shareholders. Commercial banks promptly implemented this measure.

Specifically, recently, the Beijing branch of Industrial and Commercial Bank of China successfully handled a 0.1 billion yuan special loan for listed company share buyback for Gigadevice Semiconductor Inc. This loan is one of the first announced special share buyback loans after the publication of the "Notice on Matters related to the Establishment of Share Buyback and Stake Increase Re-lending." It is understood that after the release of policies related to share buyback and stake increase re-lending, the Beijing branch of Industrial and Commercial Bank of China developed a plan for the landing of special loans for stakeholding. At the same time, they conducted marketing activities around key listed companies in Beijing, connecting with customers' financing needs.

Similarly, Bank of China announced today that they promptly formulated management requirements for share buyback and stake increase loans, and quickly supported the landing of initial projects. On October 19th, they signed share buyback and stake increase loan agreement commitments with six listed companies including China Petroleum & Chemical Corporation, Cosco Ship Engy, Cosco Shipping Holdings, Cosco Shipping Specialized Carriers, Cosco Shipping Development, and Dongxin Group. On October 20th, out of the first 23 listed companies announced by the Shanghai and Shenzhen Stock Exchanges, Bank of China supported 7 projects.

As of now, Bank of China has reached cooperation intentions with nearly a hundred listed companies, providing clear loan commitments to 32 listed companies, covering multiple industries such as integrated circuits, transportation, high-end manufacturing, and business services.

In addition, it has been learned by Cailianshe reporters that as of now, China Construction Bank has reached cooperation agreements with GRG Metrology, Shandong Linglong Tire, Linuo Glass and other listed companies, with funds covering share buybacks and shareholding, involving both state-owned enterprises and private enterprises, with interest rates not exceeding 2.25%, providing low-cost incremental funding support for listed companies and major shareholders.

Among the joint-stock banks, Cailianshe reporters have learned that after the State Council Information Office press conference on September 24, CM Bank held internal discussions and issued business guidelines to the entire bank. Within a week, it received over 90 billion increase stake & buy back financing demand, and after the relevant regulatory agencies issued business notices, the first batch of loans to customers were fulfilled. Among the first batch of customers for stock buyback and shareholding loans, there are both listed companies repurchasing loans and major shareholders increasing their loans, with clients including central state-owned enterprises and high-quality private enterprises, including but not limited to China Merchants Port Group (001872.SZ), China Merchants Shekou Industrial Zone Holdings (001979.SZ), China Merchants Energy Shipping (601872.SH), etc.

In addition, it has been learned by Cailianshe reporters that on October 20, China CITIC Bank reached cooperation with Muyuan Foods, Suzhou Maxwell Technologies, Zhejiang Jiahua Energy Chemical Industry for the successful launch of the first batch of stock buyback and shareholding refinancing business in the market.

Ensure that loan funds are 'specialized and exclusive', operate in a closed manner, and strictly guard against unauthorized inflow of credit funds into the stock market that do not meet the conditions.

Stock shareholding and buyback refinancing loans are policy tools jointly established by the People's Bank of China, the China Banking and Insurance Regulatory Commission, and the China Securities Regulatory Commission to support the management of market value of listed companies. The central bank, through low-interest rediscounting, selectively reduces the cost of funds at the bank end, guiding commercial banks and other financial institutions to provide efficient and low-cost financial support for eligible high-quality listed companies and major shareholders, helping listed companies manage their market value well and boost market confidence.

It is understood that rediscounting tools involve multiple steps such as stock shareholding and buyback, bank loans, and rediscounting by the People's Bank of China. The central bank announcement emphasizes that funds from 21 financial institutions for loans must be specifically used for stock repurchases and shareholdings, ensuring 'specialized and exclusive, closed operation'. Specifically, listed companies and major shareholders applying for loans should open a dedicated securities account; financial institutions should separately open a special bank loan account and a fund account corresponding to the aforementioned special securities account, supervising that the funds are used for stock repurchases and shareholdings by listed companies and major shareholders.

Bank of China stated that it will provide strong financial support to establish a long-term stability mechanism for capital markets, while conscientiously implementing regulatory policies and requirements, strictly guarding against unauthorized inflow of credit funds into the stock market that do not meet the conditions of share buyback and shareholding refinancing, ensuring compliance with the policy conditions of share repurchase refinancing loans, helping stabilize the operation of the capital markets, and fully supporting listed companies in their 'bigger and stronger' efforts.

Looking ahead, China Construction Bank also expressed that it will continue to do a good job in subsequent loan distribution, strengthen supervision and management of loan funds to ensure specialized and exclusive use of loan funds. It will actively communicate and cooperate with listed companies and major shareholders, understand their financing needs and buyback shareholding plans, and provide more precise and efficient financial services.

Haitong Int'l analyst Zhou Qi believes that regulatory requirements will strictly manage the loan funds of 21 financial institutions, with various specific measures to ensure "special purposes, closed operation." At the same time, if violations occur, they will face certain consequences. The People's Bank of China can, depending on the seriousness of the situation, take measures such as recovering and redeploying loan funds, canceling participation in structural monetary policy tools, etc. Different regulatory authorities have information communication linkage mechanisms, and listed companies will gradually fulfill disclosure obligations in accordance with procedures. It is expected that loans used for buybacks in the near future may exceed those used for increasing shareholding.