The People's Bank of China Cancels Mandatory Credit Rating Regulatory Requirements
On August 11, the People's Bank of China announced that in order to further enhance the autonomy of market players in using external ratings and promote the market-oriented reform of the credit rating industry, it has decided to cancel the credit rating requirements for the issuance of debt financing instruments (hereinafter referred to as debt financing instruments) for non-financial enterprises on a pilot basis, and to implement them from the date of publication.
The abolition of the mandatory credit rating regulatory requirements does not mean that bond ratings are not required, but rather the need for ratings will be returned to the market to decide. As an important basic institutional arrangement of the bond market, the improvement of the quality and distinction of credit rating will help promote the rating industry to effectively play the role of "gatekeeper" of the capital market and help the healthy development of the bond market.
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