1. Report Industry Investment Rating - No relevant content found 2. Core Views of the Report - The new regulations on the accounting treatment of special-purpose bonds strengthen capital supervision, aiming to improve the full-life cycle management of special-purpose bonds, prevent and resolve local government debt risks, and enhance the efficiency of fiscal fund use [4][5][6] - Sichuan has implemented a new management mechanism for special-purpose bonds, and Shandong aims to complete the issuance of special-purpose bonds by the end of October to promote economic development [4][8][9] 3. Summaries According to Related Catalogs 3.1 News Review - **New Accounting Regulations for Special-Purpose Bonds**: The Ministry of Finance issued the "Interim Provisions on the Accounting Treatment of Related Business of Local Government Special-Purpose Bonds," which standardizes the accounting treatment of special-purpose bond projects for administrative and enterprise project units and requires the submission of relevant information. This is an important measure to improve the full-life cycle management of special-purpose bonds and enhance fiscal governance efficiency [4][5][6] - **Implementation of New Management Mechanisms in Sichuan and Shandong**: Sichuan has established a "2+N" management mechanism for special-purpose bonds, and Shandong plans to complete the issuance of special-purpose bonds by the end of October and use a special bond quota to support key projects [4][8][9] - **Early Redemption and Cancellation of Bond Issuance**: Thirty城投 enterprises redeemed bond principal and interest in advance this week, and one城投 bond cancelled its issuance [4] 3.2 Issuance of Local Government Bonds and Urban Investment Bonds - **Local Government Bonds**: This week, the issuance scale and net financing of local government bonds decreased, with the issuance progress of new special-purpose bonds exceeding 70%. The issuance interest rate and spread both declined [4][13][14] - **Urban Investment Bonds**: The issuance scale and net financing of urban investment bonds decreased this week, while the issuance interest rate increased and the spread widened. The issuance of overseas urban investment bonds totaled 9, with a total scale of 6755 million yuan [4][18][19] 3.3 Trading of Local Government Bonds and Urban Investment Bonds - **Level Adjustment and Credit Events**: There were no level adjustments or credit risk events for urban investment enterprises this week [26] - **Trading Volume and Yield**: The trading volume of local government bonds and urban investment bonds decreased this week. The yield of local government bonds mostly increased, while the yield of urban investment bonds mostly decreased [26] - **Abnormal Trading of Urban Investment Bonds**: There were 11 abnormal trades of 10 bonds from 8 urban investment entities this week, with a decrease in the number of entities and abnormal trades compared to last week [27] 3.4 Important Announcements of Urban Investment Enterprises - Eighty urban investment enterprises announced changes in senior management, legal representatives, directors, supervisors, etc., as well as changes in controlling shareholders, actual controllers, equity/asset transfers, cumulative new borrowings, name changes, and external guarantees [31]

Core Viewpoint - The central government emphasizes the need for a systematic and effective clearance of local government financing platforms by June 2027, highlighting the importance of recognizing the urgency and complexity of this task [1][3][6]. Group 1: Historical Context and Current Situation - Government financing platforms have played a crucial role in accelerating urbanization in China, increasing the urbanization rate from 33.35% in 1998 to an expected 67% in 2024 [2]. - The establishment of these platforms has shifted the reliance on fiscal revenue for infrastructure development, introducing a market-oriented mechanism that enhances efficiency and promotes a new operational model involving government, market, and enterprises [2][3]. - However, the number of financing platforms has exceeded 10,000, leading to a high level of existing debt, which poses risks to the financial system [2][4]. Group 2: Challenges and Risks - The current economic environment presents multiple pressures, including the need to manage existing debt, control new debt, and stimulate investment for economic growth [4][5]. - The interlinked nature of urban investment debt and hidden local government debt creates a risk transmission chain, complicating the repayment of existing debts [4][5]. - The reliance on bank loans for liquidity has created additional pressures on financing platforms, with commercial banks exposed to approximately 40 trillion yuan in risks related to urban investment [5]. Group 3: Strategic Framework for Clearance - The central government's directive for a "powerful, orderly, and effective" clearance of financing platforms aims to restructure the fiscal system, financial system, and deepen state-owned enterprise reforms [3][6]. - The clearance process is not merely about debt reduction but involves a comprehensive approach to reforming the financing mechanisms and ensuring sustainable economic development [3][6][8]. - A structured approach is necessary, including phased tasks leading up to the 2027 deadline, categorizing platforms for targeted strategies, and ensuring inter-departmental collaboration [7][8]. Group 4: Implementation and Effectiveness - Effective clearance requires tangible results in debt resolution, functional transformation of financing platforms, and the establishment of a long-term management system to prevent the resurgence of hidden debts [8][9]. - The focus should be on creating a market-oriented operational mechanism that enhances the efficiency of state-owned capital and resources, ensuring that financing platforms can sustainably contribute to urban development [8][9]. - Continuous optimization of the role of financing platforms in investment guidance, asset management, and fiscal burden reduction is essential for their long-term viability [9].