SCIO briefing on financial policy package to stabilize the market and expectations

Financial Times:

I've noticed that the NFRA has launched several pilot measures to support scientific and technological innovation. In April, it worked with multiple ministries to issue the Implementation Plan for the High-Quality Development of Sci-Tech Finance in the Banking and Insurance Industries. How has the implementation of these policies progressed so far? What other supportive measures will be taken? Thank you.

Li Yunze:

Thanks for your questions. Developing sci-tech finance is essential for deeply integrating technological innovation with industrial innovation. We continue to urge banks and insurance companies to increase their support for technological innovation and to actively explore new approaches to tech finance. So far, the growth rate of loans to high-tech enterprises is nearly three times the average growth rate of all loans, and the guarantees provided by technology insurance have exceeded 2 trillion yuan. The various pilot policies we have introduced have all made positive progress. The pilot program for equity investments by financial asset management companies has been strengthened and expanded, with the total amount of intended agreements now exceeding 380 billion yuan. M&A loans for technology enterprises are progressing in an orderly manner, and pilot banks in 18 cities have already completed their first transactions. The comprehensive pilot program for the intellectual property financial ecosystem is steadily advancing, and service platforms have already been established in many locations to help resolve issues such as IP pledge registration, valuation and disposal. The service model of sci-tech insurance has been continuously optimized, and the insurance compensation mechanisms for the first set of major technical equipment and first batch of new materials have also been improved. At the end of March this year, we established China's first commercial aerospace insurance pool in Beijing. Forming an insurance pool is a common international practice in which multiple insurance companies share the risks for an emerging industry or sector. This approach is especially important for the growth of startup industries and sectors that face high uncertainty.

Next, we will focus on existing pilot projects, actively exploring new models, and improving the sci-tech finance system to better support technological innovation. In doing so, we aim to fully serve the development of new quality productive forces.

First, we will optimize credit services. We will promote the establishment of a dedicated credit support mechanism for technological innovation, support banks in setting up specialized technology finance institutions in an orderly manner, and encourage the development of a long-term performance evaluation system for sci-tech loans. Recently, we have been revising the regulations on M&A loans and will issue them as soon as possible to further unlock the potential of M&A loans and accelerate industrial transformation and upgrading.

Second, we will strengthen the role of insurance in risk protection. We will accelerate the development of guidelines for the high-quality growth of sci-tech insurance and make better use of its role in risk sharing and compensation. With the support of the insurance pool mechanism, we will provide stronger insurance guarantees for major scientific and technological breakthroughs and expand insurance products in emerging fields such as robots and low-altitude aircraft, ensuring the innovation-driven development of enterprises.

Third, we will expand equity investment. We will encourage insurance funds to actively participate in venture capital investment in accordance with market principles and to make major equity investments in unlisted technology companies in an orderly manner. We'll support eligible national commercial banks in establishing financial asset investment companies, with approvals to be granted gradually. Today, we will approve one such company, amid our efforts to increase investment in sci-tech innovation enterprises. Thank you.