Core Viewpoint - The China Interbank Market Dealers Association has issued five self-discipline announcements, warning four asset management companies and one individual for engaging in "self-financing" and "rebate" issuance practices, as well as violating regulations by holding debt financing tools on behalf of related parties [1] Group 1: Self-Discipline Announcements - Shanghai Liangmu Investment Management Co., Ltd. was severely warned for assisting an issuer in "self-financing" and "rebate" issuance through asset management products, collecting large service fees [2] - Beijing Hengrui Huida Investment Management Co., Ltd. received a severe warning for signing agreements with an issuer to assist in "rebate" issuance through related party subscriptions, also collecting large service fees [2] - Mengsen (Shanghai) Investment Management Co., Ltd. was warned for using nested trust products to assist an issuer in "rebate" issuance and collecting large service fees [3] - Shenzhen Qianhai Jiuying Asset Management Co., Ltd. was warned for illegally holding debt financing tools on behalf of related parties, affecting market trading order [3] - A private fund manager, Zhao Jian, was warned for assisting an issuer in "self-financing" issuance and arranging multiple institutions for "holding" transactions, impacting market trading order [3] Group 2: Regulatory Context - "Self-financing" refers to issuers purchasing their own bonds through subscription or buyback, while "rebate" involves issuers providing additional compensation to investors to achieve lower coupon rates [3] - Industry insiders indicate that "self-financing" and "rebate" practices can distort issuance rates and disrupt market order, potentially leading to corruption [4] - The Dealers Association's intervention aims to curb malicious competition in the industry and promote a return to professionalism and market-oriented practices [4] Group 3: Regulatory Measures - The Dealers Association has intensified supervision of violations in the bond underwriting process, issuing a notice in June that prohibits issuers and underwriters from pre-agreeing on bond issuance rates and using "rebate" methods to distort market prices [4] - The notice also states that underwriters must not quote below cost for underwriting fees and must fulfill payment obligations according to commercial agreements [4] - Investors are prohibited from assisting issuers in "self-financing" and engaging in insider trading, market manipulation, and non-market-based issuance activities [4] - Previous regulatory documents from 2022 and 2023 have reiterated that underwriters must not quote below cost and must not provide additional compensation through rebates or disguised forms [5]

Core Viewpoint - The China Interbank Market Dealers Association has issued five self-discipline announcements, warning four asset management companies and one individual for engaging in "self-financing" and "rebate" issuance practices, as well as for violating regulations by holding debt financing tools on behalf of related parties [2][3]. Group 1: Self-Discipline Announcements - Shanghai Liangmu Investment Management Co., Ltd. was severely warned for assisting an issuer in "self-financing" and "rebate" issuance through asset management products, collecting large service fees [2]. - Beijing Hengrui Huida Investment Management Co., Ltd. received a severe warning for signing an agreement with an issuer to assist in "rebate" issuance through related party subscriptions, also collecting large service fees [2]. - Mengsen (Shanghai) Investment Management Co., Ltd. was warned for using nested trust products to assist an issuer in "rebate" issuance and collecting large service fees [3]. - Shenzhen Qianhai Jiuying Asset Management Co., Ltd. was warned for illegally holding debt financing tools on behalf of related parties, affecting market trading order [3]. - A private fund manager, Zhao Jian, was warned for assisting an issuer in "self-financing" issuance and arranging multiple institutions for "holding" transactions, impacting market trading order [3]. Group 2: Definitions and Implications - "Self-financing" refers to the behavior where issuers buy back their own bonds through subscription or post-listing methods for self-use of funds [3]. - "Rebate" involves issuers providing additional compensation to investors to achieve lower coupon rates, distorting issuance rates and market order [3]. - Industry insiders indicate that practices like "self-financing" and "rebate" can distort issuance rates, affect market operations, and potentially lead to corruption [3]. Group 3: Regulatory Measures - The Dealers Association has intensified its regulatory efforts on bond underwriting violations, issuing a notice in June that prohibits issuers and underwriters from pre-agreeing on bond issuance rates and using "rebate" methods to distort market prices [4]. - The notice also states that underwriters must not quote below cost in bond project bidding and must fulfill payment obligations as per commercial agreements [4]. - Previous regulatory documents from 2022 and 2023 have reiterated the prohibition of low-cost bidding and the use of rebates or disguised rebates to interfere with market rate formation [4].