Share buyback facility rate cut 25 basis points to 1 percent
The People's Bank of China (PBOC) is cutting its share buyback and shareholding increase facility rate by 25 basis points to 1 percent, effective November 4, 2026. Banks have requested more than RMB200 billion in lending quotas.
Cheaper funding for share purchases
Effective November 4, 2026, the PBOC reduces the facility rate to 1 percent to support stable capital market operations.
The facility covers 21 nationwide banks and five systemically important city commercial banks.
It provides a financing support ratio of 100 percent and a one-year maturity, with rollover available as banks need.
Banks may charge a reasonable spread above the central bank lending rate and determine appropriate maturities and interest rates for loans financing share buybacks and shareholding increases.
The PBOC calls on banks to accelerate disbursements and help listed companies and major shareholders strengthen their market value management capabilities.
Quota requests exceed RMB200 billion
Following a November 2 symposium on the facility, banks submitted applications for central bank lending quotas totaling more than RMB200 billion.
The PBOC says it will provide sufficient quotas and continue to fully meet banks' central bank lending needs.
It also calls on lenders to respond proactively to financing demand from listed companies and major shareholders.
The announced amount represents banks' quota applications, rather than a reported total of loans disbursed.
Funding cost is not loan pricing
The rate cut lowers banks' central bank funding cost, not a uniform rate for corporate borrowers.
Banks retain discretion over loan spreads and maturities.
The quota requests document demand for facility access, while actual disbursement remains a separate measure.