Date
20 November 2017
General Stock Exchange And City Views

The Big Picture: WIDER FINANCIAL REFORM

Liu Mingkang {劉明康}, former head of the China Banking Regulatory Commission (CBRC), said financial reform should be rolled out nationwide by the central government instead of stemming from a trial program in any single city. On the sidelines of a business forum in Nanjing on Tuesday, Liu said China’s financial system should benefit commercial activity throughout the nation, Phoenix Television reported. 

The former CBRC chief said it is impossible to restrict financial reform to one city because businesses have networks and payment systems that extend beyond any municipal limits. Any anticipation that the country’s financial reform can be triggered by a single test zone is a false hope, he said.

Liu noted that former premier Wen Jiabao {溫家寶} launched financial reform in Wenzhou, Zhejiang province, two years ago because there was a need to do so. At that time, a lack of investment channels meant private capital was being informally lent to small and medium-sized businesses at high interest rates, raising risks in the nation’s financial system.

That reform was carried out to make informal loans more transparent rather than to advance interest rate liberalization or the establishment of private banks, he said. 

Liu’s comments offer food for thought for foreign financial institutions and may prompt them to revisit their plans to set up branches in Qianhai and the Shanghai free trade zone quickly.

Central bank adds new weapon to liquidity arsenal

The People’s Bank of China has beefed up its arsenal for dealing with market liquidity, China Securities Journal reported Thursday. The standing lending facility offers mortgage-backed three-month loans to banks, helping boost short-term liquidity. The lending facility had outstanding balances of 416 billion yuan (US$68.27 billion), 396 billion yuan, 410 billion yuan and 386 billion yuan in the four months from June to September, central bank data shows.

Rural land reform said to come up at party plenum

A consultation document on rural land reform has been issued to senior officials ahead of the Communist Party plenum that begins at the weekend, news portal Yicai.com reported Wednesday, citing an unnamed source. The document proposes continuing work on land rights confirmation and registration, financial innovation and boosting incomes for farmers through land lease or rental. It is not clear whether these items will make it to the final agenda.

Big Four banks’ October new loans seen at 182 bln yuan

China’s four major banks — Industrial and Commercial Bank of China (01398.HK, 601398.CN), Bank of China Ltd. (03988.HK, 601988.CN), China Construction Bank (00939.HK, 601939.CN) and Agricultural Bank of China (01288.HK, 601288.CN) – extended a combined 182 billion yuan (US$29.87 billion) in new loans in October, a drop of almost 40 billion yuan year on year, Shanghai Securities News reported Thursday. Analysts attributed the fall to seasonal factors and tighter credit in the fourth quarter. 

Foreign property firms in China elderly home projects

Several global property firms are joining Chinese developers in capitalizing on the demand for elderly housing as the country’s population ages, the Wall Street Journal reported Wednesday. Merrill Gardens Related, a joint venture between real-estate developer Related Cos. and senior-housing operator Merrill Gardens of the US, is working with local developers to build facilities for the elderly in Shanghai, Harbin and Suzhou, the paper said. In August, Sino Ocean Land and Seattle-based Columbia Pacific jointly opened Senior Living L’Amore-Kaijian, a 110-bed facility in Beijing.

–Contact HKEJ at [email protected]

JP/AC/RC

 

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