Before Li's Iron Company and Dachu Commercial Bank finalized the cooperation plan for the issuance of small shares, the Central Bank of China has already issued a document requiring Li's Iron Company and commercial banks to closely protect the interests of small investors. No messing around.
The reason why this matter has attracted the attention of the Central Bank is because many companies have done this before and caused problems.
In order to raise funds, these companies will issue some very small shares, and then attract small and medium-sized investors to buy them at high prices to raise funds.
These are normal, but then they cause a series of problems, that is, if there are more small shareholders, then there will be more share transactions.
The targets of these scattered, small-amount share transactions are not professional investment institutions, but often individuals.
Although these individual traders hold shares, it is actually difficult for them to understand the specific conditions of their companies, and they can easily be deceived and cause large losses.
This has also triggered many economic cases, and has affected the affiliated companies to a certain extent.
For example, once some of the small shareholders on the market are eager to use money to sell their shares at a low price, it will easily cause a chain reaction, causing other small shareholders to also sell their shares. In the end, the shares will depreciate significantly and even no one will care about them... But the problem is, what other companies are doing? Good.
Finally, and more importantly, there are some bad companies whose operators deliberately let ordinary people buy their small shares in large numbers in order to make money, and then donate money and run away after making money, which is illegal fund-raising!
Nowadays, the central bank is very concerned about the relatively large-scale scattered share transactions in the market, so when the Lee Iron and Steel Company wants to issue small shares, it directly sends a warning letter: Don't mess around, or you will be punished to death. !
But mere warnings are of no use. After all, this situation does not exist alone, but is already common. The central bank has already wondered whether it can establish a complete system for companies to issue shares to raise funds. It can not only protect the company's need to raise funds, but also protect the rights and interests of small and medium investors.
After all, it is a fact that a large number of companies issue small shares to raise funds, and legally, you have to let others issue shares... You are not allowed to sell your own things?
At the same time, a large number of small shareholders also have the need to trade with each other. Small investors are different from large investments and corporate investments. Those large institutional investments are strategic investments and mainly receive dividends. Even if they transfer shares, the scale is relatively large. institutional structure.
They all have enough professionalism to protect their own interests.
But small investors probably don’t even know where the company from which they bought the shares directly is located!
At the same time, they have limited funds and will transfer their shares to raise funds once they need funds.
These frequent small-amount share transactions have led to a large number of problems.
In addition, under such circumstances, it is easy for large investors and even the companies themselves to use some means to buy low and sell high, thereby harming the interests of small investors.
After all, major shareholders must clearly know the situation of their own company, and even know what the company will do in the future.
If the company has major benefits in a few months, then he can use this information in advance to absorb the shares of small shareholders to make profits.
On the other hand, if the company is not doing well and will lose money in a few months, he can also use the information to transfer shares to others in advance to cash out and leave.
This kind of major shareholder and business operator personally participates in small share transactions, which naturally occupies an absolute advantage.
This will inevitably greatly damage the interests of small and medium investors.
It will also destroy the entire stock trading market and cause many unnecessary problems.
Finally, the most important thing is to collect taxes!
Although currently, tax laws also charge taxes on share transactions, they are only collected when changing share registration, which is troublesome, and the amount collected is not much...
For this reason, the tax department has submitted suggestions to the finance department many times to ask them to regulate stock trading so that they can collect taxes. Otherwise, if you don't do it, our tax department will have to set up a tax registration for stock trading. That’s it…
To this end, the Central Bank, as a financial regulatory agency, has planned to set up a special agency for share transactions. Officials will supervise the transactions and limit the qualifications of enterprises. Do not allow any enterprise to issue shares to the public at will. People buy it, causing a lot of illegal fund-raising and escaping.
The central bank's idea quickly turned into a document and was passed to the Finance Department. However, this was the first time for the stock exchange to do this, and the top management of the Finance Department did not dare to make decisions without authorization, so they continued to report the matter to the higher authorities.
Finally, it was sent to Luo Zhixue's office.
When Luo Zhixue saw the Ministry of Finance's petition to establish a stock exchange to standardize and supervise corporate fund-raising and stock trading to protect the interests of small and medium-sized investors, avoid large-scale illegal fund-raising, and increase financial taxes.
Luo Zhixue was dumbfounded... He must know about stocks. He also thought about setting up a stock exchange when the time is right.
But he didn't expect that the officials below him would actually bring it up before he told the public about it.
This also allowed Luo Zhixue to once again see the inertia of historical development.
Even if Luo Zhixue doesn't bother with many things, they will emerge on their own when the time is right.
The previous iron-ribbed wooden hull battleships are a very typical example. This thing was first proposed by the Navy's Ship Administration Department. Luo Zhixue only found out that the Navy people were planning to build iron-ribbed wooden hull ships after seeing their initial design plan. .
The reason why the navy built iron-ribbed wooden hull battleships was because Daye Iron and Steel Company's wrought iron mass production technology had achieved a breakthrough. The output of wrought iron increased significantly and the price dropped. At the same time, the industrial sector of the Da Chu Empire also had the ability to process large-scale Wrought iron parts capabilities.
Coupled with the lack of rib timber, the Navy had to look for alternatives.
Putting all these together, without any reminder from Luo Zhixue, the Navy would start thinking about iron-ribbed wooden hull ships.
Even Luo Zhixue felt that if it weren't for the fact that the price of iron was relatively high, the power of the potential enemy's artillery was so low, and the wood used for the wooden shells was easy to find, the navy would probably have proposed a plan to build an all-iron warship.
The thought of a sailing battleship built entirely of iron but also using sails and front-mounted smoothbore guns... Luo Zhixue himself would feel particularly awkward.
This was inconsistent with his common sense.
However, this is the natural driving force brought about by the continuous development of technology and the continuous development of society.
This is true in the shipbuilding industry, and it is also true in the financial industry.
In fact, many of the current rules and even laws in the financial industry in the Dachu Empire were not created by Luo Zhixue himself... He is very busy, and he has no time to focus on the financial industry every day.
That is to say, Luo Zhixue paid more attention to it at the beginning, but it was only in the early days. Even in the early days, Luo Zhixue did not participate in some detailed developments of the financial industry.
He always specifies the framework, finalizes the general financial strategic plan, and then leaves it to his officials to toss.
Specifically, he probably established the Ministry of Finance, then the Finance Bank, the Central Bank, and set some basic principles for financial supervision.
As for the follow-up, basically let nature take its course and let the Finance Department handle it.
The Finance Department has continued to improve the rules and regulations of various financial industries over the past ten years and established a relatively primitive but relatively complete financial system.
The most important of these is the improvement of currency and banking.
The currency mainly adopts the abolition of Liang and Yuan, the establishment of the concept of Chu Yuan, and the large-scale issuance of various silver coins and copper coins. In addition, more importantly, the introduction of corresponding banknotes.
As for the banking industry, they came up with a series of concepts for savings banks, finalizing the basic businesses of banks such as collecting deposits, granting loans, and exchanging exchanges. They also finalized the margin system and, most importantly, strictly prohibited banks from participating in various commercial investments. Forget about financial investment.
These are to ensure the safety of depositors' funds.
But at the same time, the Ministry of Finance also guided the establishment of a number of fund companies. These fund companies can raise funds and then participate in various types of finance, mainly investing in various enterprises to make profits, so as to allow funds to flow in the market.
There are many other things, which are basically created by officials of the Ministry of Finance based on changes in the market economy and the political needs of the empire.
The same is true for the stock exchange this time.
The Finance Department discovered that a large number of companies issued small shares in the market, and also discovered that a large number of small shareholders conducted frequent transactions.
This means that a large number of companies need a way to raise funds other than loans. It also means that there are many people in the market who have a lot of money and want to invest, but because of limited funds, it is difficult to participate in real business operations. go.
In other words, the trading behavior of small stocks has strong market demand. It is not only needed by enterprises, but also by large investment institutions. Even small investment institutions, that is, individual investors, also need it.
However, this market demand has not been guided correctly, and a series of problems have arisen.
Now the Ministry of Finance's idea is very simple, that is, to incorporate this market demand into official supervision and formalize the trading of these small stocks.
In this way, it is convenient for companies to raise funds, and it is also convenient for investors, and it can also reduce the situation of investors being deceived to a certain extent.
The most important thing is that it can also revitalize the existing idle funds in the market and provide additional assistance for the industrial and commercial development of the empire.
To develop industry and commerce, enterprises need funds and cannot simply rely on bank loans.
Based on this situation, the Ministry of Finance will finally request the establishment of an officially governed stock exchange based on the recommendations submitted by the Central Bank.
After Luo Zhixue read the report of the Finance Department in detail, he quickly gave instructions and approved the establishment of a stock exchange. However, he had to control the pace and not go too far all at once. He had to test one or two first and improve after experience. After all the rules and regulations are laid out on a large scale, there will be no trouble.
With Luo Zhixue's approval, the Finance Department quickly finalized the corresponding charter and prepared to establish a stock exchange in Jinling City, which would be directly under the jurisdiction of the Finance Department.
The rules and regulations of the stock exchange have been strictly formulated for the time being to avoid too much trouble.
Under such circumstances, the establishment of the Jinling Stock Exchange and the corresponding corporate listing and stock trading rules were very strict.
The first is enterprises. We will not accept applications from enterprises for the time being. Instead, we will first select a number of large-scale enterprises with sufficient strength to be listed, and the number is not large. It is tentatively determined to be five, four of which will be government-run enterprises affiliated to the Ministry of Industry. , and another enterprise is tentatively designated as a private enterprise.
At the same time, the industry to which the company belongs should try to choose a low-risk industry that has been steadily profitable for many years and the company itself has matching actual assets.
They want to select a group of high-quality companies for listing, and they also want to ensure that even if the listing goes wrong, investors will not suffer too much loss after buying the stocks.
Not only is the selection of listed companies strict, but there are also great restrictions on stock trading. First of all, there is a one-size-fits-all rule. Except for stocks that are publicly issued in fixed quotas on the stock exchange, other stocks are not allowed to be traded on the stock exchange. , that is, non-tradable shares.
The shares circulating on the stock exchange can only be the tradable shares issued on the market, and other shares are not accepted for trading.
Therefore, shareholders should not expect to be able to cash out by selling their stocks on the market, because what they hold is non-tradable shares and cannot be sold on the stock exchange.
This harsh one-size-fits-all approach is simply a strict measure taken in advance to avoid problems. When relevant policies are further improved in the future, relevant adjustments will be made to this policy.
At that time, whether the conditions will be further tightened or relaxed will depend on the situation.
But... no matter how it is adjusted, the basic principle is one, which is to protect the interests of investors on the stock exchange and prevent shareholders from cutting leeks on the stock market and cashing out at high prices.
The Ministry of Finance established the stock exchange not to allow shareholders to cash out at a high level and achieve freedom of wealth... but to allow companies to gather funds for development.
Enterprises and shareholders are different entities. The Imperial Finance Department attaches great importance to the former. As for the latter, life and death are at your own risk...
Of course, if shareholders can sell their shares off-site, this is a normal business operation. How much you can sell is up to you. As long as you pay taxes in compliance with the law, the imperial officials will not interfere.
After all, the Finance Department of the Dachu Empire has no choice but to let other shareholders transfer their shares... If they really do this, it will conflict with many industrial and commercial laws and financial laws of the Dachu Empire.
Freedom of transactions is still very important for a booming economic system!
But investors who purchase shares still receive non-public tradable shares...these stocks still cannot be traded on the stock exchange.
A series of stock exchange rules formulated by the Ministry of Finance are, in principle, to protect the trading of stocks circulating on the stock exchange and the interests of investors.
For off-market share transfers, how should we do it?
After a series of rules and regulations were formulated, the Ministry of Finance announced the establishment of the 'Jinling Stock Exchange' through the Da Chu Di Newspaper, and announced the general principles of stock trading.
Subsequently, through internal review, the first batch of five companies in total was drafted for listing.
Four of these five companies are government-owned enterprises directly under the Ministry of Industry, and they are 100% controlled. This is to ensure that the listed companies can be stable without any problems.
The fifth company is a private company used for the pilot project, and this company is none other than Lee Iron & Steel, which has caused a lot of commotion among high-level domestic business circles.
Li's Steel Company had publicly introduced strategic investors before, and successfully introduced Guangzhou Iron and Steel Company as a strategic investor. After paying 2% of the shares, it received a strategic investment of 100,000 yuan from Guangzhou Iron and Steel Company.
However, this amount of money is actually not much, and it is far from enough for the at least hundreds of thousands of funds required by Li Steel.
It's not that Li Steel is unwilling to pay more shares, but Guangzhou Iron and Steel Company is not a particularly wealthy company. Although its scale is not small, they also need funds for development.
This strategic investment of 100,000 Chuyuan is just to further bind Li's Steel, a major customer.
If you ask them to pay more...that's not necessary, and they can't afford it!
Since they had not raised enough money, they naturally had to continue to raise money, so at that time they were preparing to cooperate with Dachu Commercial Bank and prepare to issue stocks directly to small and medium-sized investors to raise funds.
Later, I was warned once by the official regulatory agency and then suspended...
But they quickly contacted the Finance Department... After learning that they wanted to establish a market for publicly traded stocks, Lee Iron and Steel Company said that we could be the guinea pig for this test.
Moreover, we meet all the conditions very well and have been profitable for more than ten consecutive years, and the profits are very large!
The scale of the company is large enough, with assets in the millions. It is the largest private enterprise in the country. Even if government-owned enterprises are included, it can enter the top 30 in terms of assets in a single round.
And among the top thirty, many are government-owned enterprises in special industries such as banks, grain companies, salt companies, armed trading companies, large mining companies, and steel companies.
Moreover, our Lee Iron & Steel Co., Ltd. has a strong official background... Although we are a private joint-stock company, many of our shareholders are official capital...
Among the top five shareholders of Li's Iron, the first one is naturally the Li family, to be precise, Foshan Li's Company. The shareholders are all core members of the Li family, and they hold hundreds of Li's Iron through Foshan Li's Company. sixteenths of the shares.
The second largest shareholder is the Finance Department of the Guangzhou Prefectural Government, which holds 8% of the shares.
The third largest shareholder is the Industrial Department of Guangdong Governor's Office, holding 7.5%.
The fourth largest shareholder is Nanyang United Investment Fund, and this investment fund is one of the investment funds directly under the Ministry of Finance.
The fifth largest shareholder has nothing to do with private capital. It is Zhujiang Machinery Sales Company, and this company is a machinery sales company jointly established by more than a dozen governments in Guangdong and Guangxi. It specializes in selling a series of Li's Steel products in Guangdong and Guangxi. Distributor of agricultural tools, cooking utensils, hardware tools and other daily iron products.
Except for the Li family themselves, the top five shareholders are all official capital, and the total shares held by these four official capital companies in Li Steel has reached more than 20%.
Although they have not been able to complete the control, they still have a very large say in Lee Steel. Of course, although they have a large say, they generally do not interfere in specific operations.
The Li family is still responsible for the operating rights of Li's Steel. After all, the purpose of those investors is not for the operating rights, but for profits.
The provincial Department of Industry and the Government Finance Department have a very clear purpose, which is to support a large leading enterprise, promote the development of the industry, and develop the industrial economy.
In addition, another purpose is to prevent the hen that lays the golden eggs from flying away... After all, the conditions for heavy industry in Guangzhou are not that good. If we don't find some means, Li's Iron and Steel Co., Ltd. will go to the Yangtze River Delta. What should we do in the Bohai Rim region?
How can we tie Li Steel to the Pearl River Delta for a long time? The local government’s answer is to invest money and become a shareholder...
Under such circumstances, as long as Li's Steel keeps investment, employment, and tax revenue in the local area, and pays dividends every year, they don't care about the specific operations...
Not to mention the Nanyang Investment Fund, which is here for value-added and dividends. Although this fund is government-run, the money belongs to the customers... ensuring the safety and value-added of customers' funds is their only mission. As long as If you can make money, everything is easy to say.
As for Zhujiang Machinery Sales Company, this is even more so. It is a channel dealer...
These top-ranked major shareholders actually have limited overall influence on Lee Steel. After all, there are dozens of other shareholders who check and balance each other.
After more than ten years of development and the introduction of strategic investors in multiple rounds, Li's Steel's shares are very dispersed, with more than fifty shareholders.
And these shareholders are all institutional shareholders. Even the Li family holds shares through Foshan Li Company. Other institutions either directly invest with official capital, invest with large government-run or private funds, and others. Lee's Steel has a strategic partner with major business cooperation and is also a large and medium-sized enterprise in Yishui.
None of these shareholders are simple, but they do not interfere in the operation of the company.
This is also the reason why the Li family brought them in in the first place... It's fine to share the money, but if you want to snatch the operating rights of Li's Steel, you'd better get as far away as you can!
The Li family doesn't want any money.
Under such circumstances, the Lee family has always firmly controlled the operating rights of Lee Steel.
However, if any major event occurs, if these institutional shareholders can cooperate, they can still interfere with the operating direction of Lee Steel and even take away the operating rights of the Lee family.
To a certain extent, Lee Ironmaking was also under the official control of the empire...
As one of the first companies to be listed, it is very important to be under control. After all, the officials in the Finance Department do not want any problems to arise on the stock exchange.
If it weren't for the purpose of emphasizing the importance of private enterprises... they all want to directly designate all five listed companies as government-owned enterprises wholly owned by the Ministry of Industry, but the impact of that would not be good.
In order to reflect the official's equal treatment of government-run capital and private capital, there must be one private enterprise, and it cannot be an uncontrolled private enterprise.
Taken together, Li's Ironmaking has become the best choice!
When everything was ready, the Jinling Stock Exchange was officially opened...
