THE Shenzhen stock exchange is proposing to lower the B share transaction fee from 1.2 per cent to 0.9 per cent of the transaction value to boost turnover.
Although no official announcement has been made on the cut, the Shenzhen Securities and Exchange Commission (SEC) has reached a preliminary agreement on the move.
An SEC official said yesterday that an understanding had been reached with the exchange on such a move, but did not say when it would take effect.
''The three clearing banks have agreed to a cut, from 1.2 per cent to 0.9 per cent, and we are now gathering responses from brokers,'' he said.
Unlike Shanghai where clearing and settlement of B shares are undertaken by a central clearing and registration company, Shenzhen still relies on foreign financial institutions to act as clearing agents for B shares.
The three B share clearing banks in Shenzhen are Hongkong Bank, Standard Chartered Bank and Citibank. All are said to have a three year agreement with the Shenzhen exchange until 1995.