In this undated file photo, pedestrians pass the headquarters of the People's Bank of China in Beijing. (KUANG DA / CHINA DAILY)

BEIJING - The People's Bank of China, the central bank, conducted this year's first central bank bills swap operation on Saturday to improve the liquidity of perpetual bonds issued by commercial banks.

The CBS, valued at 5 billion yuan (about $784 million), is open to primary dealers for bidding at a fixed rate of 0.1 percent, the central bank said in a statement.

The central bank bills swap, valued at 5 billion yuan, is open to primary dealers for bidding at a fixed rate of 0.1%, the central bank said

The swap will be due on April 29, 2022.

The CBS scheme allows dealers to swap the perpetual bonds they hold for central bank bills, which will boost market demand for perpetual bonds but have a neutral impact on liquidity in the banking system.

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Perpetual bonds are fixed-income securities with no maturity date and are not redeemable but pay a steady stream of interest in perpetuity.