From TokenPost · · 50s
China's Central Bank Sets Collateral Rules for Bond Backstop
People's Bank of China requires high-grade collateral for liquidity backstop to prevent market stress cycles.
In brief
People's Bank of China requires high-grade collateral for liquidity backstop to prevent market stress cycles. China's central bank plans to mandate high-grade collateral for a liquidity facility to stop fund withdrawals and bond sales during market stress. Originally reported by TokenPost.
Central Bank Plan
The People's Bank of China plans to require high-grade collateral for a liquidity backstop to break fund withdrawals and bond sales cycles during market stress.
“We try to strike a fine balance between forestalling systemic financial risks and preventing moral hazard in financial markets”
Facility Details
The facility targets asset managers facing liquidity pressure and redemptions driving bond sales, with bank wealth management subsidiaries and public fund managers eligible.
Digital Yuan Expansion
The PBOC increased digital yuan operators to 30 institutions, covering all systemically important banks, after changing its statistical classification to deposit money in 2026.
The one thing
China's central bank plans to mandate high-grade collateral for a liquidity facility to stop fund withdrawals and bond sales during market stress.
