BUSINESS China conducts central bank bills swap


China conducts central bank bills swap


10:35, May 30, 2022

BEIJING, May 30 (Xinhua) -- The People's Bank of China, or the central bank, conducted this year's fifth central bank bills swap (CBS) operation on Monday to improve the liquidity of perpetual bonds issued by commercial banks.

Headquarters of the People's Bank of China (PBOC), the central bank, is pictured in Beijing, Oct 8, 2018. [Photo/IC]

The CBS, valued at 5 billion yuan (about 745.7 million U.S. dollars), is open to primary dealers for bidding at a fixed rate of 0.1 percent, the central bank said in a statement.

The swap will be due on August 30, 2022, said the statement.

The CBS scheme allows dealers to swap the perpetual bonds they hold for central bank bills, which will boost market demand for perpetual bonds but have a neutral impact on liquidity in the banking system.

Perpetual bonds are fixed-income securities with no maturity date and are not redeemable but pay a steady stream of interest in perpetuity.

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