Zhou Xiaochuan: Promoting sustainable and healthy development of China's debt capital market

PBoC governor Zhou Xiaochuan China bond market made great strides in recent years, the party Central Committee and the State Council issued a series of policy measures to vigorously promote the development of the bond market. 2004, the State Council issued "on the promotion of capital market reform and opening up and stable development of a number of views," clearly put forward to actively and steadily develop the bond market, to encourage eligible enterprises to raise funds through the issuance of bonds. The National Financial working Conference documents and several government work reports have emphasized the development of the bond market.　　The Central Committee's proposal for the 12th five-year plan for national Economic and Social Development, issued recently, clearly requires "speeding up the construction of a multi-level capital market system, significantly increasing the proportion of direct financing and actively developing the bond market". According to the unified deployment of the State Council, since 2005, People's Bank in conjunction with relevant departments and the industry in accordance with the market direction, in promoting the development of the bond market has taken a series of measures: reduce administrative approval, improve the market mechanism of bond issuance; Relying on the OTC market of institutional investors , establish and perfect the market-oriented restraint mechanism, gradually perfect the information disclosure system, establish the credit rating system and risk sharing mechanism, perfect the protection mechanism of investors ' legal rights and interests, strengthen the investor education, strengthen the market self-discipline management, set up the Bank of China Market Dealers Association, implement the self-regulation of the bond OTC market　　Trade, liquidation and other infrastructure construction, and steadily promote the opening up of the market. Driven by industry and market participants, the Chinese bond market has developed rapidly since 2005. After 5 years of development, China's debt capital market from small to large, has made considerable progress. First, the market system is becoming increasingly shaped. Has formed a interbank market, the exchange market as a supplement, the market coexist, division of business, interoperability, interconnection of the bond market system. Second, the product variety is increasingly rich. To meet market demand for short-term financing coupons, medium-term bills, small and medium enterprises collection of bills, local government debt, Huijin debt and other innovative products continue to emerge. Third, the rapid expansion of market size. 2010 years ago 10 months, the issuance of bonds amounted to 8.2 trillion yuan, an increase of 25%, as at the end of October 2010, trusteeship volume of 20.5 trillion yuan, an increase of 21%. Market size has leapt to Asia's second and sixth in the world. Four is the market main body unceasingly enriches. The subject of market distribution expands from government, large state-owned enterprises and financial institutions to private enterprise, Sino-foreign joint ventures and foreign enterprises. The main body of market investment now covers banks, securities companies, fund companies, insurance companies, credit unions, enterprises and other institutions. Five is the foundation system unceasingly consummates. The laws and regulations and relevant market rules and regulations complement each other, providing a strong institutional support for maintaining the market order and protecting the rights and interests of all parties. Six is the market operation mechanism constantly sound. The management of bond issue has been optimized, some of the bond varieties have adopted the market-issuing management mode of registration system, the market-oriented pricing system has been gradually improved, the market-oriented pricing mechanism of national debt and financial debt has been formed, and the market-issuing pricing model of credit bondshas been preliminarily established and gradually perfected, the market restraint and incentive mechanism gradually play a role, the information disclosure system on the relevant stakeholders continue to strengthen the binding, the introduction of credit risk management tools to provide market-oriented risk diversification and transfer means. The market self-discipline organization began to play an active role in accordance with the requirements of the change of government management market mode and the realistic needs of market development, the market members initiated the establishment of the Chinese Interbank Market Dealers Association (NAFMII) in September 2007.　　Since its inception, the Association has played an active role in speeding up the development of China's debt capital market, centering on the tenet of "self-discipline, innovation and service", and organizing market members to exert their enthusiasm and creativity. According to the principle of marketization and specialization, the association established the Registration Management system of debt financing tools of non-financial enterprises from the reality of market self-discipline management. The practice and development of the registration system have greatly improved the efficiency of the direct debt financing of Chinese non-financial Enterprises, and the market scale expands rapidly. The association fully mobilized the enthusiasm, initiative and creativity of the market members, and initially realized the transformation from the supervision-oriented innovation to the market-leading innovation, the product innovation, the system innovation and the Organization innovation. On the basis of the introduction and rapid development of medium-term bills, the paper organizes market members to research and launch SME collection bills. In order to establish the credit risk sharing mechanism, the organization market participants study and launch the credit risk sustained-release contract on the basis of drawing on the international experience fully. In order to strengthen the construction of market infrastructure, we should promote the establishment of professional credit promotion institutions and credit rating agencies on the basis of fully investigating market demand.　　The association has begun to play an effective and important role by actively carrying out various self-discipline management and service. There are still many gaps to be filled in the development of Chinese bond market in recent years, the development of China's bond market has been fruitful. However, compared with developed markets, the basic role of the bond market in the allocation of resources is not enough, still can not meet the needs of China's sustainable economic development, the main performance is: the lack of risk-averse instruments, the market mechanism for the sharing of risks is imperfect, the financial derivative market development lag; Market price can not reflect the relationship between supply and demand, and the yield curve needs to be further perfected. The institutional investors are relatively unitary, homogeneous phenomenon is still serious; the social credibility of credit rating still needs to be improved; the laws and policy issues restricting market development remain to be resolved, accounting, Tax and other supporting systems need to be adjusted according to product innovation.　　In short, compared with mature financial markets, underdevelopment is still the biggest problem facing the Chinese bond market.　　In order to establish the international competitive Chinese bond market, we must set up a Chinese bond market which is compatible with the national economic development and is in line with the market demand. First, continue to adhere to the direction of market-oriented reform, and focus on reducing unnecessary administrative controls. The main problem that restricts the rapid development of China's debt capital market is the excessive administrative function. Not only is the issue of bonds subject to administrative control, but also financial institutions are subject to various restrictions on investment bonds. World Debt Capital Markets issuedThe experience of the exhibition shows that only by dealing with the relationship between effective supervision and market-oriented development can we effectively promote the development of financial markets and guard against the risks. Second, continue to adhere to the main institutional investors and the market-oriented development model. The default risk of credit bonds is objective existence, which can not be eliminated by means of administrative examination and approval, and should be recognized and assumed by the way of marketization. Institutional investors have a specialized team with the ability to identify, undertake and dispose of risks, while individual investors are often unable to identify risks effectively because they are limited to professional competence. Therefore, the complex financial products are not suitable for individual investors, the lessons in other markets should be carefully studied and absorbed. Because of the credit risk and different product structure, the bond products are difficult to standardize, and the transaction is large and the demand is diverse, so it is decided that the bond transaction is suitable for institutional investors to reach outside the court.　　Throughout the world's bond markets, the proportion of OTC market is quite large, mostly more than 90%. Third, continue to consolidate market infrastructure. Since the onset of the international financial crisis, countries have been rethinking the causes of the crisis, the United States in July this year passed a new financial regulatory reform bill. Unlike America's financial infrastructure, China's OTC debt capital market since its inception has a unified central trusteeship system, centralized trading platform, these infrastructure to ensure that China's OTC debt capital market operation Transparent, risk controllable, but still need to rationalize the management system of market custodian, to achieve transactions, liquidation, The integration of escrow settlement system and "seamless docking".　　In addition, it is also necessary to improve the standards of underwriting institutions, rating agencies, accountants, lawyers and other intermediary agencies to achieve convergence with international standards. Four, let market self-discipline play a greater role. The experience of international market shows that strengthening self-discipline management can improve the market supervision system. The role of market self-regulatory organization is embodied in three aspects: first, the self-discipline organization is closer to the market demand, can continue to effectively promote innovation, can avoid the government departments to promote innovation is not sustainable, easy to distort the shortcomings; Secondly, self-discipline organization can promote effective communication between government regulatory departments and market participants; third, self-discipline organization close to market,　　Close contact with market participants to discover and identify significant risks earlier. V. Continue to be open to the outside. In recent years, China's debt capital market in the "Please come in" and "go out" has made certain progress, has allowed domestic institutions to issue dollar bonds, allowing international development agencies to issue renminbi bonds, allowing Asian bond funds, qualified foreign institutional investors (QFII) and foreign renminbi clearing bank, such as three types of institutions in the domestic investment bond market, allowing mainland enterprises and financial institutions to issue renminbi bonds in Hong Kong.　　Practice has proved that the opening of debt capital market has a positive significance in speeding up market maturation and market construction, and has more space. China's debt capital market has made great achievements, broad prospects and heavy responsibilities. We will continue to promote financial reform in conjunction with relevant departments, actively support the encouragement of market self-discipline organizations and market members to blaze new trails andAbsorb the beneficial international experience, brainstorm and forge ahead, promote the sustainable and healthy development of China's debt capital market.