China’s central bank cut its relending rate for participating banks to 1% Wednesday and said banks had applied for more than 200 billion yuan in related quotas.
The People’s Bank of China (PBOC) said the applications followed a Nov. 2 policy meeting. The amount refers to requested relending capacity, rather than completed lending: the PBOC did not disclose how much of the requests it had approved, how much banks had drawn or how much had been used to buy shares.
The applications are separate from figures the PBOC, National Financial Regulatory Administration (NFRA) and China Securities Regulatory Commission (CSRC) reported at their Nov. 2 meeting. They said relending-backed loans had reached about 440 billion yuan in signed contracts and topped 280 billion yuan in cumulative disbursements since the tools began in October 2024. Those totals describe loan activity under the program, while the new figure measures quota applications.
The 1% rate took effect Nov. 4, down 0.25 percentage point from 1.25%. The facility covers 21 national banks and five systemically important city commercial banks. Its support ratio is 100%, and its funding term is one year, with extensions available when needed.
The 1% is the rate the PBOC charges participating banks. Each lender can set the terms it offers companies and major shareholders, and can charge above the central bank’s rate. The PBOC said this flexibility is intended to speed lending and support market-value management by listed firms and major shareholders; it did not state borrowers’ final rates.
The program supplies central-bank funding to participating banks for loans supporting buybacks by listed companies and additional share purchases by major shareholders. The agencies said Nov. 2 that the facility would move from a phased policy to a long-term institutional arrangement, continuing the expansion of stock-support tools. The PBOC said it would keep relending support available as banks request it.
