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Original title: Expert: Optimizing the bond market development environment requires self-discipline from all parties in the market
Our reporter Wu Xiaolu
On December 20, Shang Fulin, director of the Economic Committee of the National Committee of the Chinese People’s Political Consultative Conference, said at the first financial summit of the Shenzhen Pilot Demonstration Zone and the 2020 Annual Meeting of the Wealth Management Forum 50 of China to optimize the bond market development environment. Further improve the market restriction and punishment mechanism, cultivate qualified institutional investors, and increase market transaction activity.
In recent days, the central government has also repeatedly ruled on the regulation and optimization of the development of the bond market. Market participants believe that improving market discipline and the punishment mechanism requires regulators to strengthen the issuer’s credit responsibilities and increase the punishment for violations of laws and regulations. It also requires intermediary agencies, such as bond underwriters and credit rating agencies, to be diligent and responsible, enhance professional capabilities, and strengthen controls. In addition, issuers must meet their own responsibilities and investors must improve risk identification and elimination capabilities.
“The access requirements of bond market investors, stakeholders, valuation agencies, etc. for bond issuance, pricing mechanisms, and valuation management have jointly shaped market discipline and bond market disciplinary mechanism. The government and regulatory authorities are the core of the establishment The bond issuance and trading system and regulations constitute the bond market restriction and punishment mechanism by the government, “Li Zhan said, Zhongshan Securities chief economist, in an interview with a Securities Daily reporter.
Li Zhan believes that optimizing the bond market development environment requires the joint efforts of all parties in the market. From a supervisory perspective, the first is to strengthen the disclosure of information on bonds. Establish and improve a risk and problem-oriented credit disclosure system to ensure that issuers can promptly disclose important events that may affect their creditworthiness or bond prices during the life of the bond, strengthen credit disclosure oversight and penalties for infractions, and improve credit. The relevance and risk-telling effect of Phi. The second is to strengthen primary responsibility and increase punishment for violations of laws and regulations. Build a bond dispute judicial redress system that conforms to the bond market development law, strengthen the bond market judicial protection, clarify the handling of bond default disputes, fraudulent issuances, false statements and bankruptcies of issuers, and strengthen primary liability and increase Penalties for breaches of laws and regulations by the responsible party can effectively protect the legitimate rights and interests of investors.
For intermediary agencies such as bond underwriters and credit rating agencies, Li Zhan believes that they should clarify their obligations and scope of responsibilities, improve their professional capabilities, strengthen their internal control, and be diligent and responsible within their scope of business. work and career fields. , Perform their own functions fairly and objectively. In addition, issuers must correctly understand their own rights and obligations, correctly understand the costs of breaking the law, and avoid the fraudulent issuance of bonds, false statements, misappropriation of company assets, damage to investors’ interests, and debt avoidance. . Investors should actively strengthen their own ability to identify and eliminate risks, and establish a sound investment system.
In fact, since the end of November, from the central level to the financial regulatory authorities have spoken out one after another to end “debt evasion” and promote the sustainable and healthy development of the bond market.
On November 21, the 43rd meeting of the Committee on Financial Stability and Development of the State Council indicated that it is necessary to adhere to the general tone of seeking progress while maintaining stability, and managing the relationship between promoting development and preventing risks in accordance with the principles of commercialization, rule of law and internationalization. The bond market continues to develop in a healthy manner and five requirements have been proposed.
On November 27, the China Securities Regulatory Commission launched an investigation into the alleged bond violations by Yongmei Holdings and related auditing institutions. At the same time, the China Securities Regulatory Commission stated that it will work closely with the relevant financial management departments to strictly investigate and punish relevant violations of laws and regulations in accordance with the “Securities Law” and other laws and regulations in accordance with the “zero tolerance” work requirements of the Finance Committee of the State Council, protect the legitimate rights and interests of investors and promote bonds. The market is developing in a healthy and stable way.
The Central Conference on Economic Work held on December 16-18 proposed to improve the bond market legal system and crack down on various “debt evasion” behaviors.
“Recently, due to the volatility of the bond market, the central government has repeatedly imposed requirements on the bond market.” Hu Hengsong, assistant general manager of Caida Securities, told a Securities Daily reporter that optimizing the bond market development environment requires all parties to the market to exercise self-discipline. . First, the market restriction mechanism requires that the responsibilities of intermediaries be compacted, and securities companies and other institutions must strictly follow the letter disclosure system to improve the quality of information disclosure; second, to reduce government intervention and business protection to some extent, and illegal government guarantees are strictly prohibited. But at the same time, the relevant departments should increase supervision during and after the event; third, improving the bond market system and the functioning of the market must be supported by strong laws and systems; Fourth, for misbehaviors such as “escaping debt”, local governments and regulatory departments must crack down and take full advantage of government administrative sanctions, institutional self-discipline sanctions, and market sanctions.
Regarding cultivating qualified institutional investors and increasing market transaction activity, Li Zhan believes that appropriate predetermined bond pricing mechanisms should be explored to facilitate the flow of predetermined bond transactions, and multiple institutions such as AMC e professional high-yield bond investment institutions to participate in the default bond market. It will help improve the liquidity of the high yield bond market and establish a robust risk pricing system for the China bond market.
