China Vice-Premier Liu He vows zero tolerance for misconduct after recent bond defaults
BEIJING (REUTERS) - China will show "zero tolerance" for misconduct following a string of recent bond defaults, a meeting of the Financial Stability and Development Committee chaired by Vice-Premier Liu He said.
Fraudulent issuance, disclosure of false information , malicious transfer of assets and misappropriation of issuance funds will be strictly investigated, it was decided at the meeting, according to an account posted on a government website.
Several high-profile defaults recently by Chinese state firms, including Yongcheng Coal & Electricity Holding Group and Huachen Auto Group Holdings Co, have sent shockwaves across Chinas corporate bond market.
The bond defaults dented investor confidence and pushed up funding costs for many corporate borrowers, adding to pressures on Chinas nascent economic recovery.
Prevention and warning systems will be strengthened to forestall systemic risks and liquidity should be kept reasonably ample, it was agreed at the meeting.
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