Brokers promise big money in helping finance private firms

BEIJING - Chinese brokerages have stepped up launching asset management products to help finance private companies and promised to invest their own money in the fundraising plans.

As of Friday, 26 securities companies including Everbright Securities and Dongxing Securities had pledged to offer a collective 44 billion yuan ($6.35 billion), the Securities Association of China (SAC) said in an online statement.

The SAC said 15 of them had signed agreements to set up 17 asset management products, including one subsidiary product, and contribute more than 31 billion yuan collectively.

Some had finished their initial funding rounds to help ease the cash crunch of private businesses, according to the SAC.

The group initiated the program nearly a month ago as a plunging stock market posed threats to firms that pledged their shares as collateral to borrow money.

The program is designed to provide liquidity aid to promising firms, support high-quality growth of the private sector and better serve the real economy, with the goal of drawing more than 100 billion yuan of funds from banks, insurance companies, state firms and governments.