More options to invest funds raised
By Ye Zhen |
December 22, 2012, Saturday
|
Print Edition
Print Edition
CHINA'S securities regulator has widened the scope for listed companies to invest their publicly-raised funds.
The China Securities Regulatory Commission yesterday released new guidelines to allow listed firms to use idle funds raised from the stock market for fixed-income investments such as government bonds and bank financial products.
The new rule offers the firms more leeway in investing or using their proceeds so that they can gain more benefits while ensuring the safety of the funds, the CSRC said.
The listed companies should also disclose details of any investment plan they have for the capital within two trading days after they made the decision, the CSRC said, adding that they have to report earnings every half year.
The new rule also extends the period for the idle funds raised to be used as temporary working capital by listed firms from six months to a maximum of one year.
They were previously required to use the funds raised only for the specific purposes intended.
Meanwhile, the CSRC raised from 20 percent to 30 percent the proportion of the proceeds above the fundraising target to be used to replenish working capital or repay bank loans every year. This rule, which used to apply to only those listed on the ChiNext, China's Nasdaq-style board, now extends to all listed companies.
The China Securities Regulatory Commission yesterday released new guidelines to allow listed firms to use idle funds raised from the stock market for fixed-income investments such as government bonds and bank financial products.
The new rule offers the firms more leeway in investing or using their proceeds so that they can gain more benefits while ensuring the safety of the funds, the CSRC said.
The listed companies should also disclose details of any investment plan they have for the capital within two trading days after they made the decision, the CSRC said, adding that they have to report earnings every half year.
The new rule also extends the period for the idle funds raised to be used as temporary working capital by listed firms from six months to a maximum of one year.
They were previously required to use the funds raised only for the specific purposes intended.
Meanwhile, the CSRC raised from 20 percent to 30 percent the proportion of the proceeds above the fundraising target to be used to replenish working capital or repay bank loans every year. This rule, which used to apply to only those listed on the ChiNext, China's Nasdaq-style board, now extends to all listed companies.
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