By Zhang Jiaqi
China will raise efficiency in regulating corporate credit risks by implementing a category-based management system in about three years, said a market regulation official at a policy briefing Tuesday.
On Feb. 15, the State Council Information Office holds a policy briefing in Beijing about promoting the classified management of corporate credit risk and further raising regulation efficiency. [Photo by Liu Jian/China SCIO]
China recently issued opinions on category-based management of corporate credit risks. Companies will be sorted into four categories based on their credit risks: low, moderate, relatively high, and high. The categories are not credit assessment of companies, but will rather provide references to regulators regarding oversight, according to the opinions.
The category-based management system will help to better allocate regulatory resources and improve accuracy and effectiveness, so that market regulators will be present to deal with all offenders and not disturb companies that follow the rules, said Pu Chun, vice minister of the State Administration for Market Regulation (SAMR).
So far, the SAMR has formulated the first version of an index system for corporate credit risks that contains five first-level, 25 second-level, and 81 third-level indexes. It also developed a national system for disclosing company credit information and an information technology-aided system which will enable automatic classification.
In September 2019, the SAMR launched a pilot project to test the category-based management system in 11 regions across the country, and formulated the opinions on that basis.
