About broker "return swap been stopped" message after it has been confirmed, on a-share discussions on a possible huge earthquakes.
In this regard, the China Securities Industry Association professional Committee of the OTC market on November 29 explained. Card Association professional Committee of the over-the-counter market, said yield swaps and other derivatives business itself is a risk management tool to meet the risk management needs of customers such as institutional investors. But ongoing financing such swaps securities companies actually evolved into the leveraged finance trading stocks, and there are some illegal risks and potential systemic risks.
Card Association professional Committee of the over-the-counter market, said to guard against market risks, promoting the return of return swaps primitive, the securities industry association asked the securities company to finance such proceeds swap operation to clean up code, includes several aspects:
A new stop this business; Securities daily Central Government rarely talk
Second, stock business to continue to perform the contract, but shall not be deferred;
Third, customer financing needs, through margin trading business in the specification;
Four other customers reasonable needs, such as over-the-counter derivatives risk management business will continue to function, specifications.
According to reports, as of November 27, 2015, 30 securities corporate finance gains swaps outstanding around 78.5 billion yuan. Since November, financing of such proceeds swap business daily purchases valued at 1.8 billion yuan, trillions of Yuan during the same period the average daily securities trading volume is very low. Meanwhile, in the process of cleaning, stock shares of 78.5 billion yuan according to the original contract transactions, and no attention is required.