China to Boost Asset-Backed Securities Businesses, CSRC Says

China may allow more firms to develop asset-backed securities businesses with the goal of boosting liquidity, the nation’s market regulator said.

The China Securities Regulatory Commission will lower its threshold for securities companies to undertake such businesses, the CSRC said today on its website. Asset-backed securities could be based on accounts receivable, credit assets, bonds, stocks and commercial properties, it said.

The CSRC issued draft rules for the asset-backed securities business today and asked for public feedback, according to the statement.

China Development Bank Corp., the nation’s largest policy bank, sold 9.27 billion yuan ($1.5 billion) of asset-backed securities, the bank said Sept. 7, in the country’s first such sale since 2008. The difficulty of assessing risk in bonds that are backed by loans was a major contributor to the 2008 global financial crisis.

The CSRC will also allow more futures companies to open business offices nationwide, according to a separate statement posted on the regulator’s website today. The regulator simplified review and approval proceedings for the office openings, according to the statement.

— With assistance by Helen Yuan

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