Deepening The Capital Market And Transforming The Three Main Lines Of "Tackling Difficulties" In 2020 And Building A New Prototype

The capital market is going to bid farewell to 2019 after a series of heavy events, such as the SFC, the establishment of the science and technology board and the registration system.

The market always used to sum up the past and predict the future. When reviewing the 2019, the capital market milestone event in 2019 will have the greatest impact on the future capital market reform.

The chairman of the SFC, who took office in early 2019, will have a huge and direct impact on the development of the capital market in the next 3 to 5 years, and the next 2020 will also be a critical year for deepening the reform of the capital market. In this year, the landing and implementation of the reform will determine the fineness of the deepening reform.

According to the summary of the twenty-first Century economic report reporter, in 2020, under the overall reform framework of "deep reform 12", the reform of capital market will focus on three aspects: "multi-level capital market reform and implementation", "improving the quality of listed companies" and "full liberalization of capital market".

In 2019, the central economic work conference also proposed that we should improve the basic system of capital market, improve the quality of listed companies, improve the exit mechanism, and steadily push forward the reform of the second board and third board.

"The above three aspects constitute the core logic of the reform of the capital market, and many other reforms revolve around these contents. In 2019, a number of policies fell to the ground. With the advance of reform, the policy of landing in 2020 is only a lot." The head of a medium-sized brokerage firm of investment banking in Beijing said.

Tug Gan Jun

Main battlefield of direct financing

"Deep reform 12" mentioned that we should give full play to the role of Chuang Chuang board, adhere to the location of science innovation board, optimize the linkage mechanism of audit and registration, and maintain reform and strength. We should promote the reform of the gem, accelerate the reform of the new three boards, and select a number of regional equity markets to carry out the pilot system and business innovation.

In 2019, the establishment of the science and technology board and the pilot registration system, and the successful experience of 2020, will be extended to other sectors. Under the background of the "four trial" of the securities law, the reform of multiple sectors of the capital market will start in 2020.

At present, the new three board comprehensive reform path has been determined, that is, the use of heavy incremental policy, such as the establishment of selection layer, allowing public issuance, and so on to promote the optimization of stock policy, and further open up the new three board internal and capital market system channel.

Gem reform is still under way, but in many top level design documents, the registration system reform of GEM has been firmly established. In 2020, promoting gem registration system reform is a big probability event.

The reform of these sectors will also trigger many changes in basic policies, such as the deregulation of the gem and the refinancing of the gem after the reform of the gem, and a new multi-level capital market will soon take shape in 2020.

The logic behind the linkage reform of these capital market segments is that regulators pay more attention to the role of capital market in raising the proportion of direct financing in the top-level design, and sum up the experiences and lessons in recent years. The capital market is the most important and the most efficient platform for enterprise financing, especially for small and medium-sized enterprises and private enterprises, so we must develop vigorously.

Wang Jiyue, a senior investment banker, said: "one of the fundamental guiding principles is to increase the proportion of direct financing, including the reform of the science and technology board, the reform of mergers and acquisitions, the refinancing reform, the new three board reform and the upcoming reform of the gem. In addition to the major reforms, the IPO panel has significantly improved its passing rate after the changes in the core personnel of the Commission. It is also necessary to increase the proportion of direct financing.

Improving the quality of listed companies

In addition to the reform of several sectors, in the hot words of capital market reform in 2019, "improving the quality of listed companies" is a hot word throughout the whole year. It will soon be filled with the post of chairman of the SFC, and it is clear in public that it is the most important task for them to improve the quality of listed companies.

For the first time, Yi will fully mention that when he participated in the 2019 annual meeting of the association of Listed Companies in May this year, he emphasized that in the long run, the quality of the economic fundamentals and the quality of listed companies should be determined.

In the early November 2019, when Yi was going to Zhejiang for research and field visits to listed companies, and presided over the holding of some Symposium of listed companies and listened to the opinions and suggestions on improving the quality of listed companies, he also pointed out that improving the quality of listed companies is a grand systematic project. It is necessary for all listed companies, market participants, regulatory bodies, local Party committees and governments to strengthen their work coordination and take concerted efforts to make concerted efforts. The SFC has developed an action plan to improve the quality of listed companies and is pushing ahead with relevant documents.

The reporter understands that the document referred to in it is the action plan to improve the quality of listed companies (action plan) has been issued in the securities and futures commission system. The core of the document release is to strive to make the overall appearance of the listed companies greatly improved through 3-5 years' efforts.

The plan of action is divided into seven major aspects: the effectiveness of information disclosure, the standardization of corporate governance, the reform of market based system, the normalization of delisting, the resolution of potential risks, the effectiveness of supervision and the optimization of ecology. Many of them will fall in 2020.

At the same time, reporters learned that, in view of the current problems in the governance of listed companies, the SFC will also organize a special corporate governance activities in all listed companies in 2020, and enhance its work in phases by self-examination, self correction, on-site inspection and rectification.

Managing listed companies is a complex and short term hard work. It is a long way to go to improve the quality of Listed Companies in 2020.

In response to this, Cao Yong, deputy director of the SFC's listed department, pointed out in a recent public speech that "the quality of listed companies is rich in content, including operational efficiency, accounting basis, governance capability and information disclosure."

Foreign "monks"

In recent years, the opening up of the capital market has been the focus of reform. In the last month of 2019, two foreign controlled brokerages of Nomura East and Morgan chase securities have been granted the SFC's permission to start their business.

But the opening of the capital market to the outside world, especially the introduction of high-quality institutions outside the country, has just begun. In 2020, it will be a year for foreign capital to enter the capital market securities and futures trading institutions in an all-round way.

In July 20th, a series of policies and measures announced by the office of the financial stability and Development Commission of the State Council announced clearly that the time when the ratio of securities companies, fund management companies and foreign capital stocks of Futures Company should be abolished in 2021 should be advanced to 2020.

In 2019, the SFC also formally implemented the liberalization of Futures Company, fund companies and foreign shareholding restrictions of securities companies in the fourth quarter of the year. It is clear that the above three types of agencies will complete the deregulation of foreign ownership restrictions in January 2020, April 2020 and December 2020 respectively.

The open end is an institution and the other end is capital, but in 2020, the internationalization of A shares and the proportion of foreign capital entering the A share market were slower than before.

In retrospect, the internationalization process of A shares in 2019 was orderly landing, and completed the three steps in the expansion of MSCI index respectively, and the first time the first two international indexes of FTSE Russell and S & P Dow Jones were first introduced.

After entering 2020, A has been identified as the third step in the first stage of the FTSE Russell index to be implemented. That is to say, the proportion of A shares in FTSE will continue to increase in March 2020, when the A share will reach 25%, and the proportion of the emerging market index of the FTSE Russell index and the global market index will reach 5.57% and 0.57% respectively. But compared with 2019, the process of internationalization of A shares should be slowed down, especially in the MSCI index.

"Whether from the experience of Korea or the factors restricting the increase of A shares, it is estimated that the A share will be brought into the MSCI process in the short term or slowed down after the expansion of MSCI in November, and the passive incremental funds brought about by the expansion will be weakened in 2020. However, the increase of foreign capital A shares is a relatively definite trend in recent years. Incremental foreign investment can still be expected, but the scale may drop slightly. Zhang Xia, chief strategist of China Merchants Securities, said.