PBOC steps in to ease lenders' liquidity woes

Central bank instrument to facilitate increased trading in perpetual bonds

China's central bank will provide additional liquidity to help commercial banks meet capital adequacy requirements and ease lending concerns.

The People's Bank of China unveiled a bill swap mechanism on Thursday through which financial institutions can swap commercial bank perpetual debt - that is, debt without a maturity date - for central bank bills to be used for borrowing collateral.