SHANGHAI Feb 27 Shares of Chinese brokerages
jumped on Wednesday after the mainland market regulator issued
draft rules that would make it easier for brokerages to package,
securitise and resell a wide range of assets, such as real
estate or commercial paper.
By 0255 GMT, Haitong Securities , the
second-largest listed Chinese brokerage, was up 3.7 percent in
Shanghai and 2.0 percent in Hong Kong. Its larger rival, Citic
Securities jumped 2.8 percent in Shanghai
and 2.7 percent in Hong Kong.
The gains helped both Haitong and Citic bounce off one-month
lows in Shanghai, as benchmark indices recovered from steep
losses on Tuesday.
"This will expand the scope for product innovation for
Chinese brokerages, but more care needs to be taken to make sure
these new products are not too complicated given what has
happened in the past," said Zhang Qi, a Shanghai-based analyst
with Haitong Securities.
The new plan, if approved, will open another channel for
liquidity to move into the real economy, but draft rules issued
late on Tuesday did not include a date for implementation and
are intended to solicit feedback.
China launched a pilot programme to test asset-backed
securities (ABS) in 2005, but suspended the programme during the
global credit crisis. Mortgage-backed ABS were widely blamed for
the onset of the global financial crisis in 2008.
Beijing relaunched the project in 2012 and has gradually
expanded the programme since.
($1 = 6.2339 Chinese yuan)
(Reporting by Clement Tan; Editing by Richard Pullin)