During the downturn, China asked state-backed funds to buy more stocks.

Chinese financial regulators on Thursday He announced several measures As Beijing seeks to shore up a slumping stock market, big state-owned mutual funds and insurers have been urged to buy more shares.

Large state-owned insurance companies have been instructed to increase the amount and size of their investments in mainland-listed stocks. To allocate 30% of the newly generated premium To buy shares, China Securities Regulatory Commission Chairman Wu Qing said in a press conference on Thursday.

The pilot program, which will start in the first half of this year, will transfer at least 100 billion yuan ($13.75 billion) from insurers to long-term equity investments, Wu said. He expects the program to continue to expand and inject at least “hundreds of billions of yuan” into stock buybacks each year.

So are mutual funds They ordered to increase their holdings Mainland-listed stocks 10% per annum, with respect to market valuation for the next three years;

A combination of six financial regulatorsThe securities regulator first floated the plan on Wednesday, including pension funds, to buy more local shares, “to stabilize the stock market,” according to CNBC’s statement from regulators in Chinese.

Eugene Hsia, head of China equity strategy at Macquarie Capital, said: “Having institutions such as insurers hold more Chinese stocks will help reduce volatility and create a stable trading environment based on fundamentals.”

The new initiative will “help establish more attractive long-term investment options,” he said, after the slowdown in the real estate market took a toll on family fortunes.

After the press release, the benchmark CSI 300 index rose more than 1.8 percent, narrowing the index’s drop this year to 2.7 percent, according to LSEG data.

While the CSI 300 posted an annualized gain of 15 percent last year, the index ended the year down about 12 percent from the year’s highs.

Beijing’s latest piecemeal stimulus measures have dimmed investors’ hopes for a near-term turnaround in the ailing economy, prompting a flood of money into the safety of government bonds, pushing yields lower to record lows.

In October, China’s central bank launched an exchange facility scheme that would allow insurers and brokers to buy shares more easily and access relatively cheap central bank accounts to help finance the purchase and buyback of listed companies.

Chinese companies’ dividend payouts and share buybacks hit record highs last year, Wu said, encouraging listed companies to increase dividend payouts by the end of the Chinese Lunar New Year later this month.

Wu pointed out that the CSI 300’s current yield has reached 3%, “which is significantly higher than the yield on 10-year Treasury bonds.” The benchmark 10-year yield stood at 1.671 on Thursday.

Lei Meng, China equity strategist at UBS, said Thursday’s announcement is expected to trigger capital inflows into Chinese “value stocks”.