SHENZHEN'S securities bodies are considering setting up compensation funds to bail out broker positions in case of default. Shenzhen Stock Exchange general manager Zhuang Xinyi said in Hong Kong yesterday that the plan was intended to match market development. 'The setting up of the funds will help protect the market better,' he said. Final details of how the fund would operate had not yet been worked out. Mr Zhuang, who took over from Xia Bin as the Shenzhen exchange's chief in October, said the exchange would consider the means through which money would be collected during share trade transactions for the fund's establishment. He would not say whether transaction fees would be raised if the plan were introduced. The Shenzhen Stock Exchange had an investment risk fund for bond futures investors before their trade was halted by the watchdog China Securities Regulatory Commission in May. Mr Zhuang was speaking at a seminar held by the exchange and the Shenzhen Securities and Exchange Commission in the territory, intended to provide an information forum for investors and companies. The exchange's top priority would be to solve the existing problems and meet the needs of investors and listed companies, Mr Zhuang said. 'We are committed to improving our service, strengthening our systems and increasing efficiency,' he said. He fell short of giving specifics on the problems and more importantly, the measures that would be adopted to address the shortcomings. Analysts said the lack of identity was the biggest question hanging over Shenzhen's stock market, as well as the lack of accountability and inadequate supervision. Mr Zhuang shrugged off concerns over the exchange's role as a national stock exchange after the 1997 handover. 'Shenzhen Stock Exchange has a vital role to play in China's securities development, as with that of Shanghai,' he said. 'It is still one of China's two national stock exchanges.' Despite mounting concerns over the exchange's future, he appeared confident. 'I don't think the roles of Shanghai and Shenzhen stock exchanges will change much,' he said. Shenzhen Securities and Exchange Commission deputy chief executive Liu Xinhua had helped bring confidence to the market, he said. 'We intend to make further improvements to the investment environment for the B-share market and focus on improving trading volumes,' Mr Liu said. 'In order to attract more companies from outside Shenzhen to the Shenzhen B-share market, we must become more efficient and improve the level of service.' He said efforts would be increased to ensure that national regulations on B shares were adhered to.