Shanghai Stock Exchange pilots corporate bond follow-up issuance to improve bond market liquidity.

On May 21st, the Shanghai Stock Exchange issued a notice stating that pilot companies are allowed to continue issuing corporate bonds and expand asset-backed securities. This is aimed at regulating the activities of issuing corporate bonds and expanding asset-backed securities to meet the reasonable financing needs of market entities and further enhance the liquidity of the bond market. According to the notice, issuers can apply for issuance registration with the Shanghai Stock Exchange to participate in the issuance continuation business using a valid public offering registration document or a non-public offering unobjectionable letter. In the view of market participants, issuing bonds continuously is beneficial in utilizing existing approvals, reducing repetitive applications, and significantly improving the convenience of bond issuance. At the same time, continuous bond issuance also helps smooth market fluctuations and improve the market liquidity of individual bonds. The notice states that the issuer and lead underwriter should determine the issuance price of the continuous issuance based on pricing. The issuer should strictly use the funds raised from the continuous issuance of corporate bonds in accordance with the provisions of the prospectus and relevant regulations. If there are changes to the use of the funds raised, which may have a significant impact on the issuance and listing conditions, the issuer should comply with the legal procedures for bondholder meeting resolutions.