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Veteran regulator and market reformer Xu Ming picked as Beijing Stock Exchange boss

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Xu Ming, the man picked by Beijing as the first chairman of the new stock exchange in the capital of China. Photo: WEIBIO

Xu Ming, the man picked by Beijing to head the new stock exchange in the Chinese capital, is an academic-turned-regulator with a solid track record of reforming markets.

Xu has wasted no time in getting down to work. Less than 24 hours after President Xi Jinping’s surprise announcement on Thursday night of plans for a new bourse to provide fundraising channels for small and medium-sized enterprises (SMEs), Beijing Stock Exchange completed its inception and business registration.

According to the registration document, National Equities Exchange and Quotations (NEEQ) is the only shareholder of Beijing Stock Exchange, which has a registered capital of 1 billion yuan (US$154.96 million) and Xu as its legal representative and chairman.

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After getting a master’s degree from the East China University of Political Science and Law in Shanghai and a doctorate in law from the Renmin University of China Law School in Beijing, Xu worked at the China Securities Regulatory Commission (CSRC) for more than a decade before moving to the Shanghai Stock Exchange. There he worked for seven years until he left his role as deputy general manager in 2016, according to mainland media reports.

Xu then took the role of general manager at the China Securities Investor Service Center, an affiliate of the CSRC.

The veteran regulator joined NEEQ in October 2018 as general manager and was promoted to chairman and party secretary in January of this year. Established in 2013 and known to the public as the New Third Board, the Beijing-based NEEQ was akin to a kindergarten for the stock market, where start-ups could raise funds from venture capital funds, private equity and other professional investors before graduating to raise funds in Shanghai, Shenzhen, or even in Hong Kong.

The New Third Board did not see much trading of its roughly 7,000 companies initially, as it only allowed investors with more than 5 million yuan to buy and sell shares. It only became more active after Xu introduced wide-ranging reforms to improve the quality of stocks and to lower the threshold so that investors with as little as 1 million yuan could start trading.

He implemented another reform in November allowing international investors under the Qualified Foreign Institutional Investors (QFII) and yuan-denominated QFII programmes to trade on the New Third Board.

In 2019 he adopted a three-tier system at the NEEQ to allow companies at different stages of development to tap funds. This proved effective; a year later, 716 companies had listed on the New Third Board, raising 33.85 billion yuan, a 28 per cent increase. The average daily turnover surged 57 per cent year on year to 533 million yuan.

“Mr Xu’s reforms at the New Third Board have shown his ability to improve the market. He is well known for his experience in market reform and hence a suitable candidate to lead the Beijing Stock Exchange,” said Christopher Cheung Wah-fung, a Hong Kong lawmaker and broker.

“We would like to see him link up Beijing Stock Exchange with Hong Kong stock market to create another stock connect to make it easier for international investors to invest in the Beijing market.”

Xu has tended to keep a fairly low profile, only appearing at public functions promoting the New Third Board reforms, where he emphasised their importance in enhancing fundraising capabilities, helping different types of SMEs to tap funds, improving market transparency and investor protection. His achievements have paved the way for his new post.

He will continue as chairman of NEEQ, while carrying out his new role as chairman of the Beijing Stock Exchange, the first new bourse in China since the establishment of the Shanghai and Shenzhen exchanges in 1990.

The other key management position at the Beijing Stock Exchange has also been filled by someone from NEEQ. Sui Qiang, general manager of the New Third Board, is taking the role as general manager and deputy chairman of the new bourse.

NEEQ has released three sets of consultation papers about the proposed listing rules, trading requirements and governance of the listed companies on the Beijing Stock Exchange.

Under the proposal, the 66 companies in the NEEQ’s top tier, called Select, will migrate to the Beijing Stock Exchange. They have a combined value of 186 billion yuan.

NEEQ will keep its remaining two tiers – the entry level, called Basic, and the higher level, called Innovation. Only those companies that have been listed in the Innovation tier for more than 12 months would be able to apply to list on the Beijing Stock Exchange.

They need to have a minimum market cap of 200 million yuan and a net profit of no less than 25 million yuan in the year prior to listing. Those yet to make any profit would need to have a minimum market cap of between 400 million yuan and 1.5 billion yuan.

A company’s price movement on its first day of trading would have no cap, but a daily limit of 30 per cent would apply thereafter.

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This article originally appeared on the South China Morning Post (, the leading news media reporting on China and Asia.

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