Yi Huiman, chairman of China Securities Regulatory Commission (CSRC), called upon local investment banks and investors to “enhance their capabilities and be prepared” for the new Shanghai technology board, which will soon receive the first batch of IPO applications.
“The new tech board will test the core competence of investment banks as it is much different, in terms of pricing and underwriting, from (China’s) existing boards,” Yi said on Wednesday afternoon in a press conference held by the State Council in Beijing.
The most “crucial factor” for the success of the new technology bourse, said Yi, was for local investment agencies must be fully prepared, citing the “the lack of experience” among domestic brokers.
In his first official public appearance since taking office, Yi expressed the government’s determination to revive its capital market as part of a broader plan. The full set of rules will be released “as soon as possible.” The new tech equity board is expected to feature looser trading limits, including candidates deemed “unprofitable,” as China aims to boost its innovative capabilities with a focus on new energy, biotechnology, and smart manufacturing.
However, regulators warned strenuously against fraud. Strict information disclosure guidelines will be in place, and the stock-issuing companies are responsible for verifying the accuracy of disclosures. The Shanghai Stock Exchange will conduct the majority of audits.
“Don’t blame your faults on agencies,” said Fang Xinghai, vice chairman of CSRC, instructing the SSE to “ensure a smooth start with less risks.”