In recent days, Mr. Zhou Ming, chairman of CSDC, received the interview of reporters on the account integration works.
Q: What is the meaning of building a unified account platform to the healthy and stable development of capital market?
Zhou Ming: Integrating accounts and building a unified account platform is an important action of CSDC for implementing the decision of the Third Plenary Session of the 18th Central Committee of the Communist Party of China on "enhancing financial infrastructure construction and ensuring the security, efficient operation and overall stability of the financial market" and the requirements of Nine New State Council Policies on "deploying sophisticated, centralized and unified registration and settlement system". It plays an important role to promote the healthy and stable development of capital market. First, it is beneficial for the accelerated development of multi-layer capital market. Due to the historical reason, the technical service platforms for the capital market registration and settlement background infrastructures were separately deployed according to the markets. There were the problems of repeated construction, different standards and low market efficiency. Building a unified account platform helps to unify and standardize the account systems of and forms organic connections between different layers of market, which can greatly improve the market efficiency. Second, it can support and promote the innovative development of capital market. The unified account system is flexible and expandable. It can provide great support for various types of businesses, including securities market asset management business, cross-market product innovation, etc. Third, it is good for the systematic management of capital market and the control and prevention of major risks. A unified account platform is good for the construction of registration and settlement risk control system. Securities companies can enhance the client risk identification and conduct investor eligibility management according to the new account system. Fourth, it is helpful for the protection of the legal rights and interests of investors, especially the medium and small investors. The unified securities account can facilitate the overall operation and reinvigoration of inventory securities assets of the investors, simplify the business handling and save huge costs. With the releasing of restrictions on 1 person 1 account, the investment transaction will be more convenient, and there will be more options for selection. Fifth, it supports the regulation works. The account integration can realize the conversion from account to investor and facilitate the collection of investor information, thus providing more effective centralized data support for the market regulators.
Q: There are major concerns about the releasing of the restrictions on "1 person, 1 account" in the market. What is your response to this?
Zhou Ming: Releasing the restrictions on "1 person, 1 account" is a gradual process. In the early stage when the unified account platform is launched, we will, after releasing the restrictions on "1 person, 1 account" for the special institutions, such as securities companies, securities investment funds, expand the releasing range to the common institutional investors and the individual investors participating in Shanghai-Hong Kong Stock Connect transactions, and then release the restrictions completely when appropriate. The market tolerance has been taken into full account in the gradual releasing arrangement, whose impact on the commission income and client relationship maintenance of securities companies is limited. In particular, the releasing of the restrictions on "1 person, 1 account" will facilitate the balancing of market structure, increase the market operation effectiveness, reduce the market overall cost, improve the market overall efficiency, and promote the improvement of market service quality, service level and business innovation.
Q: What is the further plan of CSDC in deploying sophisticated, centralized and unified registration and settlement system?
Zhou Ming: To fulfill the requirements of Nine New State Council Policies on "deploying sophisticated, centralized and unified registration and settlement system", CSDC will try to finish the following tasks. First, to provide more secure and efficient infrastructure services for accelerating the development of multi-layer market, and helping the multi-layer market better serve the real economy transformation and development; provide great support and services to Shenzhen and Shanghai stock exchanges to enhance their market dominance; provide great support and services to facilitate the rapid development of national share transfer system; actively facilitate and promote the interconnection and interworking of the bonds market infrastructures; actively support the innovative development of asset management industry; to facilitate the construction of financial derivatives settlement system; actively regulate and guide the regional market infrastructures with the exchange infrastructure standards; provide flexible infrastructure supports for the private market; and promote the interconnection and interworking of the private market infrastructure. Second, to promote the deployment of sophisticated, centralized and unified registration and settlement system; realize the rollout and stable operation of the unified account platform as scheduled; enhance the technical resources planning; steadily implement the Principles for Financial Market Infrastructures; and fully exert the functions of settlement fund system to provide interconnected fund transfer services for the industry. Third, to enhance the construction of infrastructure risk management system, improve the risk handling capacity in the case of significant incidents and extreme market conditions, strengthen the management of bonds pledge and repurchase risks by exchanges, improve the bonds rating system and stick to the underlying risk principles, in order to ensure the market continuity and prevent and release the systematic and major business risks. Fourth, to improve the securities transfer and collateral disposal system, realize the interconnection of the transaction platforms of the three regions; actively expand the online businesses and counter-related businesses, expand the scope of business of the securities companies to facilitate the investors; support market innovation, and enhance the protection of the legal rights and interests of the investors, especially the medium and small investors. Fifth, to facilitate the two-way opening of the capital market, make preparation for the Shanghai-Hong Kong Stock Connect registration and settlement to ensure the smooth rollout of the Shanghai-Hong Kong Stock Connect businesses, actively support for the mutual recognition of mainland and Hong Kong fund products, and provide infrastructure support for the cross-border fund products.