More financing to get firms back to business
Financial regulators in Shanghai have come up with more supportive policies to help companies get back to work and resume production after having to close shop during the citywide lockdown to curb the spread of COVID-19.
The People's Bank of China Shanghai Head Office has introduced a guideline of 20 policies supporting both epidemic control and economic growth with the help of the financial sector, with credit support being a major highlight, said Yu Wenjian, director of the Financial Consumer Protection Bureau of the PBOC, at a news conference on Sunday.
The credit injected into the market will be steadily increased to effectively address the financing difficulties vexing market entities, according to the guideline.
Financial institutions in Shanghai will be better guided to render more loans to companies, especially those included in the white lists to restart production. The city government has released two white lists that include more than 1,800 companies from key industries such as biomedical, automotive and equipment manufacturing.
Sectors hit hard by the epidemic, such as restaurants, hotels, retailers, wholesalers and travel agencies will also be favored in terms of loan issuance, according to the guideline.
Since the latest epidemic outbreak hit Shanghai in March, 33.5 billion yuan ($5 billion) in loans have been provided to 731 providers of daily necessities and logistics companies. Over 10,000 restaurants, retailers, travel agencies and transportation companies that have been seriously affected by the epidemic have received 72.3 billion yuan in bank loans so far, Yu said.
More credit will be provided to nurture scientific research and technology upgrading, while the financial needs of energy suppliers and logistics services providers will be equally addressed, he added.
State-owned Shenergy Group has received a 12-year, 480-million-yuan loan from China Construction Bank with the help of the PBOC's Shanghai Head Office, he said.
Cao Guangqun, deputy head of the China Banking and Insurance Regulatory Commission's Shanghai Office, said at the Sunday news conference that loans provided by local commercial banks to individual truck drivers as well as small and micro-sized logistics companies amounted to 28 billion yuan by the end of April, up 12.4 percent on data collected at the beginning of the year.
Financial institutions will launch more inclusive policies and further cut fees to help small and medium-sized enterprises weather the current difficulties, said Guan Xiaojun, deputy head of the Shanghai Financial Regulatory Bureau.
SMEs are able to extend their current loans without paying the principals. The China Foreign Exchange Trade System, whose physical operation is located in Shanghai, has exempted small and micro enterprises from all the commissions in foreign exchange derivative trading, Guan said.
Securities, futures and fund management firms are encouraged to provide more financial aid to pharmaceutical companies specializing in the research and production of novel coronavirus vaccines and antigen test kits, said Wang Dengyong, deputy head of the Shanghai Securities Regulatory Bureau.
Haitong Securities, for example, has served as a major underwriter to help Shanghai Lingang Holdings in issuing 500 million yuan in corporate bonds that are being used as financing for the construction of makeshift hospitals in Lin-gang Special Area, according to Wang.
Shanghai registered 215 COVID-19 local confirmed cases and 3,760 asymptomatic infections on Saturday. Only 11 infections, all asymptomatic, were found outside of quarantine and lockdown zones.
There were 412 severely ill and 84 critical cases in the city as of Saturday.