BEIJING, Oct. 9 (Xinhua) -- China's securities
regulator on Thursday said publicly-traded companies must pay dividends in cash
rather than stock over three years before submitting their refinancing
applications.
The move could help to encourage long-term investment
and reduce market volatility, the China Securities Regulatory Commission (CSRC)
said.
The benchmark Shanghai Composite Index has plunged 66
percent from its record high last October.
In a new regulation stipulating cash dividend payment
by listed companies, the CSRC said: "The listed firms, if applying for
refinancing, must pay dividends in cash totaling no less than 30 percent of its
distributed profits over the past three years."
The regulation went into effect on Thursday.
In the draft version released in August, companies
were allowed to pay dividends either in cash or stock.
The listed firms were also ordered to reveal their
cash dividend policies and previous cash dividend data to investors in their
annual reports to improve transparency.
"The listed company should give reasons why it failed
to pay a cash dividend if it is able to and where the money goes," according to
the rule.
Cash dividends could offer stable investment returns
and prompt large institutional investors to reduce speculation on the secondary
market, the regulator said.
A couple of huge refinancing plans earlier this year
triggered a market plunge on concerns over stake dilution and liquidity stress.
In a separate regulation on share buy-back, also
effective on Thursday, the CSRC said it allowed a cash dividend payment when the
controlling shareholders bought stocks on the secondary market.
Such action was banned in the draft version released
in late September to solicit public opinion.
Share buy-back through bidding at stock exchanges
also no longer needs regulatory approval.
The CSRC added it would continue to revise the rules
on stock buy-back and also give consideration to repurchase through agreement or
tender offer.
China central bank cuts interest rate,
reserve requirement to stimulate economy
BEIJING, Oct. 8 (Xinhua) --
China's central bank on Wednesday announced cuts in both the interest rate and
reserve-requirement ratio in the latest effort to boost the domestic economy
amid worries over the deepening global financial crisis.
The deposit and lending rates would be lowered by
0.27 percentage points from Thursday and the reserve-requirement ratio would be
down by 0.5 percentage points from Oct. 15, the People's Bank of China (PBOC)
said. Full story
China cancels stamp tax on stock purchase to support equities
market
BEIJING, Sept. 18 (Xinhua) -- China decided on Thursday to scrap the stamp
tax on stock purchase, effective on Friday, in a move to boost the equities
market after domestic stocks fell for third consecutive day since Tuesday.
With the authorization of the State Council, China's Cabinet, the Ministry
of Finance and the State Administration of Taxation said they decided to cancel
the share trading stamp tax on stock
purchase while the stamp tax on share selling remained unchanged at 0.1
percent. Full story
Vice premier:China confident, capable
of overcoming economic challenges
BEIJING, Oct. 9 (Xinhua) -- Chinese Vice Premier Wang
Qishan said on Thursday the country is fully confident and capable of overcoming
the current economic difficulties, vowing to work closely with other countries
to safeguard stability of the global financial market.
Wang, in his meeting with former German Chancellor
Gerhard Schroeder, said China has already taken relevant measures to face up to
the turbulences of the international financial market. Full story
