Shanghai Stock Exchange to roll out index funds, urge banks to enhance investor communications to boost distressed valuations
- The proposal to improve banks’ valuations and develop index funds was outlined to executives of state-backed lenders by Cai Jianchun, the exchange’s general manager
- China’s banking sector is the most distressed industry group, trading at an average of 36 per cent discount to the book value, according to Bloomberg data
The exchange’s general manager Cai Jianchun outlined the proposals to executives from major publicly traded banks including Industrial and Commercial Bank of China (ICBC) and China Construction Bank at a closed-door seminar on Wednesday, said the people who were briefed about the conference. Lifting the valuation of Chinese banks, which trade at a significant discount to the book value on average, was one of the exchange’s key tasks this year, the people said, citing Cai.
Cai also urged banks’ board secretaries to be more attentive to investor relations and engage frequently with investors by arranging international investor conferences and events featuring company visits by overseas fund managers, the people said.
The Shanghai exchange declined to comment.
