China's northern city of Tianjin has applied to set up the country's first national over-the-counter stock exchange as part of the city's plan to bolster its financial strength, a vice mayor has said.

The municipality has drafted detailed proposals on the OTC market and submitted an application to the National Development & Reform Commission in March for approval, Cui Jindu, Tianjin's vice mayor told reporters at an economic forum on Wednesday.

The OTC bourse, which is only available to institutional investors, will introduce a market-making system to boost liquidity, according to Cui. Market makers refer to institutions that quote prices and buy shares when turnover is low.

China's mainland has two main stock exchanges in Shanghai and Shenzhen as well as a small and medium-size enterprise board in Shenzhen in Guangdong Province.

There is also an OTC trading system for Beijing-based technology firms.

Earlier media reports said that several cities including Beijing, Shanghai and Shenzhen wanted to set up OTC markets. Analysts, however, noted the central government might allow Tianjin to set up the OTC bourse to help the city develop into another financial hub in addition to Shanghai.