The People's Bank of China (PBOC) has made a significant move to stabilize the country's capital market by conducting the first operation of the Securities, Funds, and Insurance companies Swap Facility (SFISF) on Monday.
The initial operation involved 50 billion yuan ($7.04 billion), marking the beginning of a broader initiative to support the healthy and stable development of China's financial sector.
Announced on October 10, the SFISF was established with an initial scale of 500 billion yuan. This financial tool enables eligible securities, funds, and insurance companies to use their assets—including bonds, ETFs, and CSI 300 Index constituent stocks—as collateral. In return, these institutions receive highly liquid assets such as treasury bonds and central bank bills.
The PBOC officially launched the SFISF last Friday, with the first group of application quotas surpassing 200 billion yuan. Twenty securities and funds companies were approved to participate in the SFISF operations, highlighting the central bank's commitment to fostering a robust financial environment.
On Monday, China International Capital Corporation Limited became the first investment bank to complete a transaction through the SFISF, demonstrating the facility's practical application in the market.
Reference(s):
cgtn.com
