CX Daily: It’s Curtains for China’s Local Financial Asset Exchanges

Exchanges /

In Depth: It’s curtains for China’s local financial asset exchanges

China’s regional financial asset exchanges (LFAEs) were once lauded as venues for local small and midsize companies and financial institutions to sell nonperforming assets. Now they are being shut down as part of a broader regulatory effort to stamp out illegal fundraising.

Despite repeated crackdowns to clean up LFAEs in recent years, the government finally called time on the exchanges in November. Financial authorities in Hunan and Liaoning provinces, the provincial capital of Shaanxi, and the municipality of Chongqing revoked the business licenses of their official LFAEs in March. Those in Jilin, Jiangxi and Shandong provinces, as well as Qingdao, a major city in Shandong, followed suit in May, while Shenzhen’s official LFAE voluntarily applied to exit the industry.