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Chinese Banks Replies |
rffrydr
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 Posted: Thu Nov 24, 2011 1:26 pm Post subject: |
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*CHINA CENTRAL BANK SAYS IT LOWERS RRR FOR SOME BANKS BY 50 BPS
2011-11-23 10:43:55.682 GMT
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HenryTo
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rffrydr
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HenryTo
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rffrydr
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| Posted: Tue Jun 21, 2011 3:41 pm Post subject: |
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Credit Suisse uses the macro data to back fit chinese NPLs and, in contrast to GK, doesn't like it:
http://ftalphaville.ft.com/blog/2011/06/21/601051/credit-suisse-slashes-chinese-banks/
Can't be so blase about about the indirect backing of the currency reserves as last time they had a market to sell into. This time....? Buy more exposure to japanese banks and get the spillover--if it happens.
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rffrydr
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| Posted: Wed Apr 13, 2011 6:41 am Post subject: |
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Fitch cut its outlook on China’s local currency debt. It maintained its AA- rating but downgraded
the outlook to negative from stable. “Fitch said today the large increase in household and
corporate leverage in combination with the sharp increase in housing prices and the recent
emergence of inflationary pressure have raised the likelihood that "some sovereign support for the
banking system will be required." "The Negative Outlook reflects concern over the scale of
sovereign contingent liabilities and risk to macro-financial stability arising from the very rapid pace
of bank lending in recent years, especially against the backdrop of rising real estate valuations and
inflation, "said Andrew Colquhoun, Head of Fitch's Asia-Pacific Sovereigns group.” … “Fitch has
been warning for several years about the build-up of contingent liabilities in the Chinese banking
system, warning earlier this year of a 60% chance of the country facing a banking crisis by mid-
2013. It estimated that a 15% to 30% rise in the non-performing loan (NPL) could need
"upwards of 10%-30% of GDP in support for the system."
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rffrydr
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| Posted: Wed Oct 27, 2010 8:29 pm Post subject: |
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China banks
Published: October 27 2010 09:52 | Last updated: October 27 2010 23:09
| Quote: | Scattered throughout Wednesday’s third-quarter numbers from Bank of China and Agricultural Bank of China, the first of the country’s big lenders to report, are homilies about “promoting [the bank’s] healthy development” and “managing risks and sharpening competitiveness.” This isn’t just the standard cant. The age of irresponsibility is over.
Last year’s splurge of new lending across the banking system – up 32 per cent from 2008 – was deemed necessary to safeguard the nation’s recovery. Job done, asset growth over the past nine months has been more moderate: 15 per cent for BoC and 14 per cent for AgBank. That is consistent with expectations of new loan targets for 2011, likely to be set around Rmb7,000bn, to deliver growth of 14 to 15 per cent. Further, the maximum 75 per cent loan-to-deposit ratio, relaxed during the crisis, is now more rigorously enforced by the regulator (BoC squeaks in at 74.7 per cent). Finally, capital concerns are front and centre. As BoC disclosed an above-average core capital ratio of 9.4 per cent, Citic (below average) received approval from the regulator to issue shares in Shanghai and/or Hong Kong. Last week BoC and CCB (also above average) got the green light to raise as much as Rmb135bn between them. |
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rffrydr
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| Posted: Mon Sep 13, 2010 4:08 pm Post subject: |
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China’s banking regulator may require banks to have core capital of 4% of their total assets, according to sources. The CBRC will also require systemically important banks to maintain a capital adequacy ratio of 11%, and other lenders 10%,
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rffrydr
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rffrydr
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| Posted: Fri Jul 09, 2010 10:25 pm Post subject: |
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Capitalism with fewer Chinese characteristics
| Quote: | Indeed, there is only one thing that will guarantee the demise of China’s present model of banking: success. If China manages to digest its recent lending boom without a slump and then rebalance its economy away from investment and towards consumption, banks will need to free up space on their balance-sheets for lending to individuals and small firms. The heavy lifting of financing infrastructure and state companies will shift to bond markets. As customers have more sources of finance, banks’ lending profits will be squeezed, forcing them to diversify into capital-market activities like underwriting. Banks’ buffers of deposits should also shrink, relative to loans, as the savings rate falls and as people move cash into higher-return shares and bonds (earning banks fees in the process).
China’s banks could then end up looking a lot like banks elsewhere, although the state will still have control. Yet even that could change gradually. At current growth rates China’s banks will need capital injections every few years. The government may tire of these shakedowns—its participation in this year’s equity raisings has been a little grudging—and allow its stake to be diluted instead. And, as China’s banks claim their rightful place among the global leaders, they will find doing big foreign deals is hard when the government has a hand on the steering wheel. The rise of China’s banks is stunning and a little frightening. Yet they are not the pallbearers of market-based finance, just a work in progress. |
http://economist.com/node/16541609
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rffrydr
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| Posted: Tue May 18, 2010 7:28 am Post subject: |
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Japan never did get a bond "market," nor, I predict, will china. Plus ca Change:
Renminbi bonds
Published: May 18 2010 09:26 | Last updated: May 18 2010 13:44
| Quote: | Panda bonds, unlike bears, could be poised to proliferate. On Thursday Mitsubishi UFJ, Japan’s biggest lender, plans to raise Rmb1bn ($146m) by selling two-year bonds to Chinese investors. Supranational entities have been here before, but MUFG is a landmark: the first renminbi sale by an arm of a proper, non-Chinese company.
This is no thrilling new chapter in the internationalisation of the people’s currency. The sale is by the locally-incorporated subsidiary, rather than the Tokyo-based parent, and proceeds – of course – must stay within China. Still, it is a gesture towards a deeper domestic bond market. At the moment, issuance is dominated by the government: for every renminbi borrowed by corporates in China over the past three years, central government and quasi-government entities have borrowed five. Domestic banks are almost entirely deposit-funded; senior and subordinated bond issuance averages 1 per cent of total liabilities at the big six listed lenders. A more diverse palette of issuers by sector and parentage must also be good news for buyers. The typical Chinese fixed-income fund, maxing out its exposure to equities, still gets about two-thirds of its annual returns through initial public offerings, estimates Z-Ben Advisors, a fund consultancy. |
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