SHANGHAI, March 5 The Shanghai Stock
Exchange aims to launch high-yield corporate debt in the first
half of this year to help small companies raise funds, the
Shanghai Securities News said on Monday, citing the exchange's
chairman Geng Liang.
Geng is the first senior securities industry official to
confirm China's plans to authorise high-yield debt after weeks
of speculation in local media.
The exchange is now working out details of establishment
mechanisms and approval procedures to curb risks, Geng told the
newspaper in an interview.
It is considering setting up a special fund to compensate
investors in cases of default, with the money to be collected
from debt issuers as well as the exchange, Geng was quoted as
Local media has reported since early February that China may
soon launch a high-yield junk-bond market to expand credit
access to small private firms largely shut out of China's
state-dominated financial system.
(Reporting by Lu Jianxin and Fayen Wong; Editing by Jonathan