Shenzhen Stock Exchange (SZSE) promulgated the Business Guidelines for Asset Securitization (2014 revision) today in a bid to make corresponding adjustment to legal application and supervision rules after China Securities Regulatory Commission (CSRC) cancelled the administrative examination and approval on asset securitization business.
The following amendments and supplements are made to the Business Guidelines:
- first, detailing the conditions for transfer by listing, and clearly requesting the managers to apply for such eligibility to SZSE before issuing any asset securitization;
- second, specifying the conditions for products listing, especially for key processes such as underlying asset transfer, associated security interest transfer and cash flow forecast;
- third, strengthening investor suitability management and clearly defining the scope of qualified investors;
- fourth, emphasizing the supervision over information disclosure by mean of detailing disclosure requirements for listing initial information, follow-up ratings, etc.; and
- fifth, integrating other SZSE rules on asset securitization into the Business Guidelines for the purpose of investors’ easy understanding of the transfer mechanism for asset-backed securities.
SZSE has made great success in the initial stage of serving real economy via asset securitization business, as expressed by an officer of SZSE. Asset securitization products were issued to support shantytowns transformation in Xuzhou and Xiamen, the Alibaba Micro Credit Securitization Product was listed to serve small and micro enterprises, and the first exchange-traded Real Estate Investment Trust (REIT) was launched. 16 special plans with issuing value of RMB 20.483 billion have been issued and listed this year. After the amendment, SZSE will continue to facilitate financing of small and micro enterprises, explore agricultural assets securitization, and accelerate product innovation for Credit Assets Securitization and REITs based on the new regulatory requirements and effective control of overall risk.