On April 12, the State Council issued several opinions on strengthening Supervision and preventing risks to promote the High-quality Development of the Capital Market (hereinafter referred to as "opinions"). The opinions issued this time consist of nine parts, which is the third "National Nine articles" of the capital market, and the capital market guidance document issued by the State Council again after the two "National Nine articles" in 2004 and 2014.

The new 'National Nine articles' has made a clear plan for the future development of China's capital market, which fully reflects that the state attaches great importance to the development of the capital market. In the future, with the gradual implementation of the '1th N' policy system, China's capital market will usher in a more robust, standardized and efficient development, and will inject a stronger driving force into economic and social development. " Gao Ruidong, chief economist of Everbright Securities (601788) and director of the Institute, said in an interview with a Chinese reporter from a securities firm.

"compared with previous documents, this blockbuster document carries a heavier historical task, focusing on cleaning up historical problems, and standardizing development on this basis, which is closer to the construction of the rule of law in 2016. In fact, withJackpotspinChina's capital market is becoming mature, and since 2016, the necessity of structural adjustment policy is gradually higher than that of unilateral development policy, which is determined by the principal contradictions at different stages. " Fu Jingtao, a strategist at Shen Wanhongyuan (000166), commented.

Reshape the capital market system

As a programmatic document for the long-term construction of the capital market, the new "National Nine articles" sets the development goals that the capital market will achieve in the next five years, by 2035, and by the middle of this century.

The "opinion" points out that in the next five years, the overall framework for the high-quality development of the capital market will basically be formed. By 2035, a highly adaptable, competitive and inclusive capital market will be basically built, and the legitimate rights and interests of investors will be more effectively protected. By the middle of this century, the level of modernization of the capital market governance system and governance capacity will be further improved, and a high-quality capital market matching with financial powers will be built.

Wu Kaida, chief strategic officer of Tianfeng Securities and director of the Policy Research Institute, believes that the landing of the new "National Nine articles" and subsequent supporting rules will help the capital market to clean up chaos, reshape value, and enhance the inherent stability of the capital market. the quality of listed companies is expected to be further improved, the capital structure is more reasonable, the basic system is more perfect, the market regulation mechanism is more effective, professional services are more high-quality, and supervision and law enforcement are more stringent. A-shares can also better support the real economy and return investors.

"in the past, the A-share market as a whole had 'more in and less out', and market funds were diverted to a certain extent, and some companies also had financial fraud and illegal reduction, which disturbed investors' confidence in the stock market and was not conducive to the long-term development of the capital market." Gao Ruidong told Chinese brokerages that improving the quality and investment value of listed companies is the policy focus to promote the high-quality development of the capital market, and three of the nine measures of the new "National Nine articles" are all related to this. It includes strict access to issuance and listing, strict supervision of listed companies, and strengthening delisting supervision, which fully reflects the goal-oriented and problem-oriented concept of the new "National Nine articles." Make up for the weaknesses, strengths and weaknesses in time.

Yan Xiang, chief economist of Huafu Securities, said that for the capital market, each round of institutional reform plays an important leading role in the development of the capital market in the future. From the perspective of historical experience, there are two important institutional developments in the A-share market, one is the "National Nine articles" in 2004, which mainly solves the problem of non-tradable shares, and the second is the "National Nine articles" in 2014 to build a multi-level capital market and promote the reform of the registration system.

"judging from the results, the institutional construction of the 'National Nine principles' in 2014 put an end to the five-year depressed bear market of A shares, and the index rose from July 2014 to May 2015, although it was fuelled by leveraged funds. but on the whole, it is the National Nine principles that have laid an important foundation for this round of market." Yan Xiang said.

Wang Yi, chief economist of Great Wall Securities, told Chinese brokerage reporters that this new "National Nine articles" is more stringent in wording, more involved in aspects, and more detailed in regulations than the previous two, with emphasis on "consistency of macro policy orientation". Subsequent regulation of the capital market may pay more attention to inter-departmental coordination, rather than being limited to the CSRC. In the follow-up, the institutional rules in raising listing standards, giving full play to the role of securities funds, optimizing dividends, standardizing and reducing holdings, strictly delisting standards, cracking down on violations, and introducing medium-and long-term funds will continue to be improved. The investability and return of the capital market are expected to be improved in the long run.

Improve the quality of listed companies

Xun Yugen, chief economist of Haitong Securities and director of the Research Institute, said that the new "National Nine articles" put forward a series of policies around improving the issuance and listing system, strengthening continuous supervision, and improving the delisting system. We will further improve the "import customs" and smooth "export customs" of listed companies, and promote listed companies to enhance their investment value.

In terms of listing system, opinions should be made to further improve the system of issuance and listing, strengthen the responsibility of the whole chain of issuance and listing, and strengthen the supervision of issuance and underwriting. In this regard, Xun Yugen believes that it is expected that the IPO system will be upgraded iteratively to improve the quality of A-share listed companies from the source.

In terms of continuous supervision, the new "National Nine articles" provides guidance for the market capitalization management of listed companies in such aspects as strengthening information disclosure and corporate governance, increasing dividends, and improving the norms of shareholding reduction. Xun Yugen believes that continuous supervision can effectively purify the development ecology of the capital market and enhance the attractiveness of the capital market. For example, there is still a certain gap between the persistence of A-share dividends in 2022 and developed markets. Listed companies with A-share dividends for 10 consecutive years account for 31%, which is lower than that of the United States (44%) and Japan (76%). Under the guidance of policies, the proportion of A-share dividends is expected to increase.

In terms of delisting system, the new "National Nine articles" proposes strict delisting standards and supervision, and expand multiple exit channels. At the same time, it also defines the compensation and relief mechanism for delisted investors. Xun Yugen believes that this will speed up the formation of a regular delisting pattern of A shares and optimize the efficiency of resource allocation in the capital market.

Hu Yuwei, chief policy analyst at CITIC Construction Fund, also pointed out that the new "Guojiu Article" focuses on three areas, namely listing, delisting and dividends.

Specifically, the first is to raise the threshold and access standards for listing to ensure the quality of the entry clearance of listed companies. The second is to further improve the four categories of compulsory delisting indicators: finance, major violations, norms and transactions. The third is to strengthen the restriction of dividends. For a company whose net profit in the most recent fiscal year and undistributed profit in the parent company statement are both positive, if the total cumulative cash dividend in the last three fiscal years is less than 30% of the average annual net profit in the last three fiscal years, and the cumulative dividend in the last three fiscal years is less than 50 million yuan, ST will be implemented.

Yan Xiang said that the focus of the follow-up policy will make great efforts to improve the quality of listed companies, and management will start from two aspects: import and export. On the import side, the entry threshold for listing will be strictly imposed, the responsibility of the whole chain of issuance and listing will be strengthened, and the accountability mechanism of audit retrospective accountability will be established; on the export side, great efforts will be made to increase delisting efforts and smooth diversified delisting channels, with special emphasis on "further reducing the value of 'shell' resources."

In addition, the supervision of delisting will be further strengthened, and controlling shareholders, actual controllers, directors, and senior executives responsible for major illegal delisting should compensate investors for losses in accordance with the law, and implement the responsibility of delisting to individuals.

Yan Xiang also mentioned that in the future, there will be strict supervision of listed companies to promote their investment value, mainly from two aspects: on the one hand, it is necessary to standardize the reduction of holdings of listed companies, resolutely prevent all kinds of detour reduction according to the principle of "substance is more important than form", and severely crack down on all kinds of illegal reduction; on the other hand, encourage listed companies to pay dividends and enhance the investable value of listed companies.

Strengthen the strength of long-term investment

"it is not that institutions cannot develop, but that they should develop in the direction of policy guidance on the basis of standardizing operation." Fu Jingtao, chief analyst of Shen Wanhongyuan research strategy, said that the policy first emphasizes "dealing with the relationship between functionality and profitability", "actively cultivating a good industry culture and investment culture" and "strengthening transaction supervision". The second is the layout of "vigorously promote medium-and long-term capital to enter the market" and "continue to strengthen the long-term investment force".

Fu Jingtao also mentioned that "promoting the formation of a joint force to promote the high-quality development of the capital market" has laid out the content of inter-departmental coordination from the implementation level. The policy first focuses on the coordinated law enforcement and joint crackdown on violations of laws and regulations, and then mentions the coordination of the linkage of serving the real economy from the central and local governments and ministries, which also embodies the idea of regulation before development.

Xun Yugen pointed out that the new "National Nine articles" gives important instructions on the reform of the investment side of the secondary market from three aspects.

First, strengthen trading supervision. In view of the problem that some quantitative funds and short selling forces disturb the market order, the new "National Nine articles" proposes to "issue procedural trading supervision regulations. Strengthen the supervision of high-frequency quantitative trading", "seriously investigate and deal with malicious short selling and other illegal activities that manipulate the market", and at the same time propose to "strengthen the reserve of strategic forces and the construction of stability mechanism", which will help to enhance the inherent stability of the market.

The second is to promote the entry of medium-and long-term funds into the market, and public offerings and risky funds account for only about 15% and 6% of A-share investors. in order to strengthen the long-term investment strength, the new "National Nine articles" proposes to "vigorously develop equity public offering funds." greatly increase the proportion of equity funds "and" urge the establishment of rational investment, value investment, and long-term investment concept ", and propose to" optimize the policy environment for equity investment of insurance funds. " Better encourage long-term equity investment "and" enhance the flexibility of enterprise annuity and individual pension investment ".

The third is to improve the system guarantee. The new "National Nine articles" proposes to "promote the strengthening of the construction of the rule of law in the capital market, greatly increase the cost of violation of laws and regulations," and "increase the joint crackdown on securities and futures crimes." this will help to optimize the A-share investment environment and attract more investors to enter the market.

Qin Tai, assistant director and chief macro officer of Huajin Securities Research Institute, told brokerage Chinese reporters that residents can obtain a long-term higher rate of return than debt financial products through long-term investment in the capital market, so that the residential sector, as the fundamental source of long-term funds, can feel the sense of wealth and well-being in the process of high-quality economic development, so as to effectively attract more long-term funds with a certain risk-bearing capacity.

As the mainstay of capital market intermediaries and investment institutions, securities fund institutions have an unshirkable responsibility in the overall improvement of their professional capabilities and the construction of new models. In the area of investment and asset management business, securities fund institutions should continue to improve their ability to serve medium-and long-term funds. Securities companies also need to continue to step up efforts to promote the new and professional construction of securities research business, and actively cooperate to promote the core competence building of public offering fund investment and research. " Qin Tai said.

In addition, Qin Tai also suggested to step up efforts to encourage the design and issuance of modern portfolio public offering products in the real sense, so as to effectively improve the unit risk rate of return of residents' investment by greatly enhancing the professionalism of the design and operation of financial products, and drive a new round of upgrading and optimization of residents' asset allocation structure in the context of the deep adjustment of the real estate market.

On April 12, the State Council issued several opinions on strengthening Supervision and preventing risks to promote the High-quality Development of the Capital Market (hereinafter referred to as "opinions"). The opinions issued this time consist of nine parts, which is the third "National Nine articles" of the capital market, and the capital market guidance document issued by the State Council again after the two "National Nine articles" in 2004 and 2014.

The new 'National Nine articles' has made a clear plan for the future development of China's capital market, which fully reflects that the state attaches great importance to the development of the capital market. In the future, with the gradual implementation of the '1th N' policy system, China's capital market will usher in a more robust, standardized and efficient development, and will inject a stronger driving force into economic and social development. " Gao Ruidong, chief economist of Everbright Securities and director of the Institute, said in an interview with a Chinese reporter from a securities firm.

"compared with previous documents, this blockbuster document carries a heavier historical task, focusing on cleaning up historical problems, and standardizing development on this basis, which is closer to the construction of the rule of law in 2016. In fact, withJackpotspinChina's capital market is becoming mature, and since 2016, the necessity of structural adjustment policy is gradually higher than that of unilateral development policy, which is determined by the principal contradictions at different stages. " Fu Jingtao, a strategist at Shenwan Hongyuan, commented.

Reshape the capital market system

As a programmatic document for the long-term construction of the capital market, the new "National Nine articles" sets the development goals that the capital market will achieve in the next five years, by 2035, and by the middle of this century.

The "opinion" points out that in the next five years, the overall framework for the high-quality development of the capital market will basically be formed. By 2035, a highly adaptable, competitive and inclusive capital market will be basically built, and the legitimate rights and interests of investors will be more effectively protected. By the middle of this century, the level of modernization of the capital market governance system and governance capacity will be further improved, and a high-quality capital market matching with financial powers will be built.

Wu Kaida, chief strategic officer of Tianfeng Securities and director of the Policy Research Institute, believes that the landing of the new "National Nine articles" and subsequent supporting rules will help the capital market to clean up chaos, reshape value, and enhance the inherent stability of the capital market. the quality of listed companies is expected to be further improved, the capital structure is more reasonable, the basic system is more perfect, the market regulation mechanism is more effective, professional services are more high-quality, and supervision and law enforcement are more stringent. A-shares can also better support the real economy and return investors.

"in the past, the A-share market as a whole had 'more in and less out', and market funds were diverted to a certain extent, and some companies also had financial fraud and illegal reduction, which disturbed investors' confidence in the stock market and was not conducive to the long-term development of the capital market." Gao Ruidong told Chinese brokerages that improving the quality and investment value of listed companies is the policy focus to promote the high-quality development of the capital market, and three of the nine measures of the new "National Nine articles" are all related to this. It includes strict access to issuance and listing, strict supervision of listed companies, and strengthening delisting supervision, which fully reflects the goal-oriented and problem-oriented concept of the new "National Nine articles." Make up for the weaknesses, strengths and weaknesses in time.

Yan Xiang, chief economist of Huafu Securities, said that for the capital market, each round of institutional reform plays an important leading role in the development of the capital market in the future. From the perspective of historical experience, there are two important institutional developments in the A-share market, one is the "National Nine articles" in 2004, which mainly solves the problem of non-tradable shares, and the second is the "National Nine articles" in 2014 to build a multi-level capital market and promote the reform of the registration system.

"judging from the results, the institutional construction of the 'National Nine principles' in 2014 put an end to the five-year depressed bear market of A shares, and the index rose from July 2014 to May 2015, although it was fuelled by leveraged funds. but on the whole, it is the National Nine principles that have laid an important foundation for this round of market." Yan Xiang said.

Wang Yi, chief economist of Great Wall Securities, told Chinese brokerage reporters that this new "National Nine articles" is more stringent in wording, more involved in aspects, and more detailed in regulations than the previous two, with emphasis on "consistency of macro policy orientation". Subsequent regulation of the capital market may pay more attention to inter-departmental coordination, rather than being limited to the CSRC. In the follow-up, the institutional rules in raising listing standards, giving full play to the role of securities funds, optimizing dividends, standardizing and reducing holdings, strictly delisting standards, cracking down on violations, and introducing medium-and long-term funds will continue to be improved. The investability and return of the capital market are expected to be improved in the long run.

Improve the quality of listed companies

Xun Yugen, chief economist of Haitong Securities and director of the Research Institute, said that the new "National Nine articles" put forward a series of policies around improving the issuance and listing system, strengthening continuous supervision, and improving the delisting system. We will further improve the "import customs" and smooth "export customs" of listed companies, and promote listed companies to enhance their investment value.

In terms of listing system, opinions should be made to further improve the system of issuance and listing, strengthen the responsibility of the whole chain of issuance and listing, and strengthen the supervision of issuance and underwriting. In this regard, Xun Yugen believes that it is expected that the IPO system will be upgraded iteratively to improve the quality of A-share listed companies from the source.

In terms of continuous supervision, the new "National Nine articles" provides guidance for the market capitalization management of listed companies in such aspects as strengthening information disclosure and corporate governance, increasing dividends, and improving the norms of shareholding reduction. Xun Yugen believes that continuous supervision can effectively purify the development ecology of the capital market and enhance the attractiveness of the capital market. For example, there is still a certain gap between the persistence of A-share dividends in 2022 and developed markets. Listed companies with A-share dividends for 10 consecutive years account for 31%, which is lower than that of the United States (44%) and Japan (76%). Under the guidance of policies, the proportion of A-share dividends is expected to increase.

In terms of delisting system, the new "National Nine articles" proposes strict delisting standards and supervision, and expand multiple exit channels. At the same time, it also defines the compensation and relief mechanism for delisted investors. Xun Yugen believes that this will speed up the formation of a regular delisting pattern of A shares and optimize the efficiency of resource allocation in the capital market.

Hu Yuwei, chief policy analyst at CITIC Construction Fund, also pointed out that the new "Guojiu Article" focuses on three areas, namely listing, delisting and dividends.

Specifically, the first is to raise the threshold and access standards for listing to ensure the quality of the entry clearance of listed companies. The second is to further improve the four categories of compulsory delisting indicators: finance, major violations, norms and transactions. The third is to strengthen the restriction of dividends. For a company whose net profit in the most recent fiscal year and undistributed profit in the parent company statement are both positive, if the total cumulative cash dividend in the last three fiscal years is less than 30% of the average annual net profit in the last three fiscal years, and the cumulative dividend in the last three fiscal years is less than 50 million yuan, ST will be implemented.

Yan Xiang said that the focus of the follow-up policy will make great efforts to improve the quality of listed companies, and management will start from two aspects: import and export. On the import side, the entry threshold for listing will be strictly imposed, the responsibility of the whole chain of issuance and listing will be strengthened, and the accountability mechanism of audit retrospective accountability will be established; on the export side, great efforts will be made to increase delisting efforts and smooth diversified delisting channels, with special emphasis on "further reducing the value of 'shell' resources."

In addition, the supervision of delisting will be further strengthened, and controlling shareholders, actual controllers, directors, and senior executives responsible for major illegal delisting should compensate investors for losses in accordance with the law, and implement the responsibility of delisting to individuals.

Yan Xiang also mentioned that in the future, there will be strict supervision of listed companies to promote their investment value, mainly from two aspects: on the one hand, it is necessary to standardize the reduction of holdings of listed companies, resolutely prevent all kinds of detour reduction according to the principle of "substance is more important than form", and severely crack down on all kinds of illegal reduction; on the other hand, encourage listed companies to pay dividends and enhance the investable value of listed companies.

Strengthen the strength of long-term investment

"it is not that institutions cannot develop, but that they should develop in the direction of policy guidance on the basis of standardizing operation." Fu Jingtao, chief analyst of Shen Wanhongyuan research strategy, said that the policy first emphasizes "dealing with the relationship between functionality and profitability", "actively cultivating a good industry culture and investment culture" and "strengthening transaction supervision". The second is the layout of "vigorously promote medium-and long-term capital to enter the market" and "continue to strengthen the long-term investment force".

Fu Jingtao also mentioned that "promoting the formation of a joint force to promote the high-quality development of the capital market" has laid out the content of inter-departmental coordination from the implementation level. The policy first focuses on the coordinated law enforcement and joint crackdown on violations of laws and regulations, and then mentions the coordination of the linkage of serving the real economy from the central and local governments and ministries, which also embodies the idea of regulation before development.

Xun Yugen pointed out that the new "National Nine articles" gives important instructions on the reform of the investment side of the secondary market from three aspects.

First, strengthen trading supervision. In view of the problem that some quantitative funds and short selling forces disturb the market order, the new "National Nine articles" proposes to "issue procedural trading supervision regulations. Strengthen the supervision of high-frequency quantitative trading", "seriously investigate and deal with malicious short selling and other illegal activities that manipulate the market", and at the same time propose to "strengthen the reserve of strategic forces and the construction of stability mechanism", which will help to enhance the inherent stability of the market.

The second is to promote the entry of medium-and long-term funds into the market, and public offerings and risky funds account for only about 15% and 6% of A-share investors. in order to strengthen the long-term investment strength, the new "National Nine articles" proposes to "vigorously develop equity public offering funds." greatly increase the proportion of equity funds "and" urge the establishment of rational investment, value investment, and long-term investment concept ", and propose to" optimize the policy environment for equity investment of insurance funds. " Better encourage long-term equity investment "and" enhance the flexibility of enterprise annuity and individual pension investment ".

The third is to improve the system guarantee. The new "National Nine articles" proposes to "promote the strengthening of the construction of the rule of law in the capital market, greatly increase the cost of violation of laws and regulations," and "increase the joint crackdown on securities and futures crimes." this will help to optimize the A-share investment environment and attract more investors to enter the market.

Qin Tai, assistant director and chief macro officer of Huajin Securities Research Institute, told brokerage Chinese reporters that residents can obtain a long-term higher rate of return than debt financial products through long-term investment in the capital market, so that the residential sector, as the fundamental source of long-term funds, can feel the sense of wealth and well-being in the process of high-quality economic development, so as to effectively attract more long-term funds with a certain risk-bearing capacity.

As the mainstay of capital market intermediaries and investment institutions, securities fund institutions have an unshirkable responsibility in the overall improvement of their professional capabilities and the construction of new models. In the area of investment and asset management business, securities fund institutions should continue to improve their ability to serve medium-and long-term funds. Securities companies also need to continue to step up efforts to promote the new and professional construction of securities research business, and actively cooperate to promote the core competence building of public offering fund investment and research. " Qin Tai said.

In addition, Qin Tai also suggested to step up efforts to encourage the design and issuance of modern portfolio public offering products in the real sense, so as to effectively improve the unit risk rate of return of residents' investment by greatly enhancing the professionalism of the design and operation of financial products, and drive a new round of upgrading and optimization of residents' asset allocation structure in the context of the deep adjustment of the real estate market.