Sustainable Development Finance in China | Mar 2019

1. Report on Fintech Promoting the Development of Green Finance in China: Cases and Prospects Released

On March 9, the Green Finance Center of the Paulson Institute and the Research Center for Green Finance Development of Tsinghua University jointly released the report of Fintech Promoting the Development of Green Finance in China: Cases and Prospects. The report shows four cases of how China promotes the sustainable development of green finance with fintech. According to the case studies, emerging technologies such as blockchain, big data, cloud computing and artificial intelligence can be effectively applied to the field of green finance and improve financial institutions in their cost, efficiency, security, and data authenticity. They can also provide more accurate and efficient services for financial supervision in standards promotion, statistics, auditing, anti-greenwashing, etc.

2. People's Bank of China Holds Symposium with Ministry of Finance and China Banking anad Insurance Regulatory Commission

On March 3, the People's Bank of China, in conjunction with the Ministry of Finance and the China Banking and Insurance Regulatory Commission, held an online symposium on giving financial support for epidemic prevention and control as well as economic and social development. The meeting emphasized that the financial sector should follow the way of "stabilizing expectations, expanding the total amount, and focusing on classification, roll-overs, creating tools, and implemention", and efficiently provide financial support for epidemic prevention and control as well as economic and social development. First, monetary policy should be more sound with higher flexibility and appropriateness to unlock the potential for loan prime rate (LPR) reform. Second, the 300 billion yuan special re-loan policy should be well managed in order to provide rapid and precise support to enterprises that are preventing and controlling the epidemic, and sustaining supply chain. Third, financing support to regions, industries, and enterprises that are severely affected by the epidemic should be increased.

On March 6, the China Securities Regulatory Commission (CSRC) issued "Special Regulations on the Reduction of Shares Held by Shareholders of Venture Capital Funds of Listed Companies." The Shanghai Stock Exchange and the Shenzhen Stock Exchange simultaneously amended the implementation rules, which was officially implemented on March 31. In order to further improve the exit channel of venture capital funds, smooth the "investment-exit-reinvestment" virtuous cycle, and to involve private equity and venture capital funds in preventing and controlling the epidemic, the CSRC further revised and improved the reverse link policy, which is conducive to alleviating the “exit difficulty” of private equity investment funds and venture capital funds.

4. China Beijing Environmental Exchange Transformed and Upgraded into China's First Green Asset Exchange

China Beijing Environmental Exchange is making efforts to transform and upgrade from a regional carbon trading platform to the first green asset exchange in the country. It aims to attract more domestic and foreign capital to participate in green asset transactions such as green bonds, green asset-backed securities (ABS), green project financing, and carbon finance. The institute is conducting internal researches to select the optimal plan for trading asset.

6. Huzhou Approved as National Pilot City for Coordinated Development of Green Building and Green Finance

The Ministry of Housing and Urban-Rural Development, the People’s Bank of China, and the China Banking and Insurance Regulatory Commission jointly issued a document, in which Huzhou City, Zhejiang Province, was approved as the country's first pilot city in the field of coordinating the development of green buildings and green finance. It is another major breakthrough of green finance reform and innovation in Zhejiang. By 2021, the proportion of green building industry will be increased to more than 20%, and the balance of green building loans will account for 15% of the whole real estate development loan balances in this city.

7. ABC's Inclusive Financial Loans Rank First among the Four Major Banks