Date
7 December 2016
Xiao Gang, China's top securities watchdog, attended a meeting with 50 brokerages in which they were told to help shore up the stock market. Photo: Bloomberg
Xiao Gang, China's top securities watchdog, attended a meeting with 50 brokerages in which they were told to help shore up the stock market. Photo: Bloomberg

Chinese brokers told to put 100 bln yuan in stock rescue fund

Dozens of Chinese brokerages are being asked to contribute 100 billion yuan (US$15.74 billion) to a rescue fund to shore up the wobbly stock market.

Also, they are being told to ramp share buybacks, according to people familiar with the matter cited by Bloomberg.

The China Securities Regulatory Commission (CSRC) gave the order on rescue-fund contributions at a meeting with representatives of 50 brokerages on Saturday, which chairman Xiao Gang also attended.

The regulator encouraged listed brokerages to buy back shares worth as much as 10 percent of their total market value.

China revived its stock market rescue program on Aug. 27 after the government’s absence from the market earlier in the week contributed to the biggest two-day sell-off since 1996.

Policymakers are trying to bolster shares before President Xi Jinping takes the stage in a World War II victory parade this week.

The CSRC meeting was reported earlier by Cailian.

The regulator did not immediately respond to a faxed request for comment.

China’s Shanghai Composite Index was down 2.8 percent in early morning trade.

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