“Special bonds + special loans” work in synergy to accelerate local debt clearance!

Play a role “ Repay local governments’ outstanding payments to enterprises. ” The cumulative issuance volume of special bonds with newly added special features has already exceeded this year. 1.2 Trillions of yuan—exceeding market expectations. Meanwhile, special loans from nationwide commercial banks to support debt clearance efforts have been gradually coming to light, reflecting the concerted use of fiscal and financial tools since the third quarter. " Clear outstanding debts " The speed has noticeably increased.

The Ministry of Finance has now clearly signaled its intention. “ Use the debt-reduction quota ahead of time. ” policy signals, as... “ Special-purpose bonds + Special-purpose loan ” The collaborative synergy model is gradually maturing, and in the future, enterprises will see further relief from cash flow pressures. Additionally, the likelihood of systemic risks triggered by debt defaults will also continue to decline.

Special Newly Issued Special Bonds “ Overissue ”

As of 9 Moon 21 On the day, the local government issued undisclosed bonds in the open market. “ One case, two documents ” The specially issued special-purpose bonds, primarily used for local debt resolution and overdue payment clearance, exceed... 1.2 Trillion yuan, including 8000 100 million yuan “ Supplement the financial resources of local government funds. ” Special-purpose bonds and local governments’ direct use of “ Addressing local governments' arrears in payments to enterprises. ” Special-purpose bonds (hereinafter referred to as) “ Clear outstanding debts ” Special-purpose bonds.

In Wuping County, Fujian Province, the local authorities plan to issue... “ Supplement the financial resources of government funds ” The special bonds will be used to clear temporary payments; in Xi'an, Shaanxi Province, local authorities have made arrangements. 11.55 100 million yuan “ Clear outstanding debts ” Special-purpose bonds to support the resolution of overdue payments owed by government agencies and fully funded public institutions to construction companies; in Hunan Province, locally allocated... 415 100 million yuan “ Supplement the financial resources of government funds ” Among the special bonds, there is... 200 The hundred million yuan will be used to address overdue payments to enterprises. …… According to statistics from Qiyu Tong, currently Yunnan, Hunan, and other regions... 8 The province has been publicly announced. “ Issuing bonds to settle debts ” Its scale exceeds 100 billion yuan.

Compared to traditional fiscal debt-clearing methods, issuing... “ Clear outstanding debts ” Special-purpose bonds offer greater advantages in local efforts to clear outstanding debts. Wen Laicheng, a professor at the School of Finance and Taxation at the Central University of Finance and Economics, pointed out that by using special-purpose bonds to settle arrears, local governments can transform previously hidden overdue payments into explicit government debt. This not only standardizes debt management but also reduces short-term repayment pressures. Moreover, since the interest rates on special-purpose bonds are lower than market financing costs and the bonds have longer maturities, “ Issuing bonds to settle debts ” This can significantly ease the financial strain on local governments and provide a guarantee for enterprises to promptly recover funds and restore their operational vitality.

From the perspective of operational methods, “ Issuing bonds to settle debts ” in a more precise manner. Gao Hongyu, an assistant professor at the School of Finance and Taxation of the Central University of Finance and Economics, revealed that... “ Issuing bonds to settle debts ” Implement “ Whitelist ” For management purposes, cities and counties must first identify and compile information on enterprises with outstanding debts, which then undergoes provincial-level review. Furthermore, provinces are permitted to centrally allocate funds across regions, giving priority support to high-risk areas. “ This precise and coordinated operational model is something that would be difficult to achieve with the conventional, fragmented disbursement of fiscal funds. ”

Arranged by the Ministry of Finance 8000 Based on the hundred-million-yuan level, localities are adjusting their budgets and... “ Overissue ” The special newly issued special-purpose bonds demonstrate the proactive stance of local governments in addressing debt and settling outstanding payments. Wang Feng, associate professor at the Institute of Chinese Public Finance at Shanghai University of Finance and Economics, stated that this... “ Over-issuance ” It is a proactive move to address the complex situation of local government debt.

Enrich the debt-collection toolkit

In addition to raising funds through bond issuance in the open market to accelerate the pace of debt clearance, several nationwide banks are now, guided by market-oriented and rule-of-law principles, providing special-purpose loans to support local efforts in clearing outstanding debts.

After sorting through it, we found that... 7 Since this month, branches of national banks in Hunan, Guangxi, Henan, Xinjiang, Liaoning, Shandong, Fujian, and other regions have successively announced cases of providing special credit support specifically for clearing overdue payments owed to enterprises. Based on these cases, the primary recipients of these special loans are public institutions, local state-owned enterprises, and local government financing platform companies.

Sources close to regulatory authorities revealed that government agencies, public institutions, local state-owned enterprises, and local government financing platform companies have been included in the list of key entities targeted for debt clearance. These entities can, in accordance with relevant regulations, accelerate debt repayment by leveraging funding sources such as special-purpose bonds and special-purpose loans. This measure will help alleviate financial pressures on small and medium-sized enterprises and speed up capital turnover. Currently, special-purpose loans are primarily being provided by major state-owned banks and joint-stock commercial banks. Banks will assess loan applicants based on locally compiled lists of enterprises with outstanding debts and then decide whether to extend special-purpose loan support. Relevant departments across various regions will regularly compile and report on the progress of implementing these special-purpose loans.

“ Currently, our bank primarily provides special-purpose loans to eligible local state-owned enterprises, with the loan amounts determined through a comprehensive assessment of the enterprises’ repayment capabilities, including their own operating revenues. However, since most of these special-purpose loans are relatively small—typically in the million-yuan range—the approval authority for such loans generally rests with local branches. ” A person from the corporate banking department of the headquarters of a major state-owned bank said.

Another branch president of a joint-stock bank stated that the bank’s implementation plan allows target entities—such as municipal investment companies that have already obtained credit lines from the bank—to use their loan funds specifically, within their approved credit limits, to settle outstanding accounts payable owed by other enterprises. “ This involves adding a new loan purpose within the existing credit limit, but it does not increase the company’s overall credit line. ”

For some time now, government departments at all levels have been holding intensive special meetings focused on clearing overdue payments owed to enterprises. One of the key priorities being addressed is leveraging financial tools to support debt clearance. For example, Hong'an County in Hubei Province has... 8 Moon 20 At the recent meeting on advancing the cleanup of overdue payments to enterprises, it was noted that financial institutions such as banks should, without increasing the scale of the government’s implicit debt, address the issue of overdue payments in a lawful and compliant manner—through measures such as issuing short-term working capital loans.

Judging from the cases of special loans for debt-clearing enterprises already implemented by several banks, the aforementioned special loans indeed fall under the category of working capital loans. Regarding whether working capital loans can be used by enterprises to repay external debts, a senior official from one of the major banks explained that such debts are accounts payable arising from a company’s normal production and operational activities—representing legitimate funding needs for ongoing business operations—and thus qualify as an eligible use for working capital loans.

“ Working capital loans are divided into two payment methods: self-payment and entrusted payment. Under certain conditions—such as when the loan amount is relatively large—it is mandatory to use entrusted payment for each individual disbursement in order to mitigate moral hazard. ” The senior official from the major bank mentioned above stated that, since the special-purpose loans are intended by the borrower to settle outstanding payables to external parties, in order to prevent the borrower from diverting the loan funds for other purposes, banks will transfer the loan funds to the indebted enterprises via trustee payments, thereby ensuring that the funds are used exclusively for their designated purpose.

Xinjiang Weitai Development & Construction (Group) Co., Ltd. (hereinafter referred to as [company name]) “ Vite Shares ” ) 9 Moon 1 The announcement released today also provides a clearer statement on this matter. The announcement states that the Bank of China has approved providing Vite Shares with an amount not exceeding... 9.8 The special loan amount for settling outstanding debts is in the hundreds of millions of yuan, and the loan term does not exceed. 5 Year. Regarding withdrawal methods, Vite Shares must open a special escrow account with the Bank of China, and the Bank of China will disburse funds into this escrow account. After the list of outstanding payments is reviewed and approved by the special task force for debt clearance under the autonomous region, the relevant materials will be submitted. Once approved, funds will be disbursed from the escrow account on a per-item basis, ensuring that the loan funds are used exclusively for their intended purpose and precisely directed to the entities that have been owed payment.

However, currently there aren’t many instances of this type of business being implemented; a staff member from a major bank in another eastern province also stated that in their region... 8 The month marks the start of advancing this business. Consequently, various regions and financial institutions are currently still exploring pathways and models for supporting debt clearance under the principles of marketization and rule of law.

Debt-clearing efforts continue to accelerate.

Whether using special bonds or special loans, local efforts to clear outstanding debts are accelerating. 9 Moon 12 On [date], the People's Government of Jilin Province held a video conference on clearing overdue payments owed to enterprises across the province, emphasizing the need to expand diversified repayment channels and accelerate the settlement of undisputed debts in the shortest possible time, ensuring that the work is completed according to the scheduled timeline. 9 The end-of-month and year-end targets for clearing outstanding debts. The meeting also called for effectively implementing various policy tools, including fiscal and financial measures.

9 Since this month, many regions including Jilin, Heilongjiang, Liaoning, Shanxi, Hebei, and Hubei have held meetings to accelerate efforts to clear overdue payments owed to enterprises. Meanwhile, local authorities... “ Issuing bonds to settle debts ” The pace is still accelerating, as of... 9 In the middle of the month, the monthly issuance volume of special bonds for specific new projects exceeded... 2300 100 million yuan, exceeding 8 Total lunar eclipse.

“ This year, the available quota for newly issued special-purpose bonds has fallen below one trillion yuan, and local governments may focus on issuing special new special-purpose bonds instead. ” Gao Hongyu told reporters that the issuance of replacement bonds for this year is nearing completion. “ Issuing bonds to settle debts ” Acceptance is on the rise, and any remaining quota for newly issued special bonds should be prioritized for such projects. " Emergency rescue " This measure can both alleviate the cash flow pressures faced by enterprises and prevent systemic risks triggered by debt defaults.

Several interviewed financial experts emphasized that the traditional approach for local governments to clear outstanding debts remains through integrated fiscal budgeting—including the surplus of the general public budget, revenue from government funds budgets, and transfer payments from higher-level governments. This implies that effectively mitigating local debt risks, improving fiscal revenues, and ensuring fiscal sustainability will strengthen local governments’ capacity to clear their outstanding debts.

The Ministry of Finance recently revealed that next year will... “ Use the debt-reduction quota ahead of time. ” and issue part of it in advance 2026 The annual new local government debt limit. In Wang Feng’s view, next year’s bond issuance structure will be similar to this year’s: replacement bonds will continue to play a leading role, accelerating the pace of debt resolution, which will also help local governments repay outstanding debts owed to enterprises.