Week ended 26 August 2011
KPMG China's weekly banking news summary
This publication is a summary of publicly reported information, the accuracy of which has not been verified by KPMG.
CCB to issue RMB 80 billion worth of bonds 每 President of China Construction Bank (CCB) Mr Zhang Jianguo stated that CCB does not need to raise capital to boost its core capital base in the short term. However, CCB plans to issue RMB 80 billion (USD 12.5 billion) worth of subordinated bonds in mainland China and Hong Kong.
CCB plans to open a subsidiary in Russia by injecting USD 150 million worth of capital.
Better than expected profits from Chinese banks 每 Ten Chinese commercial banks have reported better than expected net profits of RMB 244.7 billion (USD 72.11 billion) in the first half of 2011, approximately 30 percent more than the net profits reported for the same period in 2010. The increase was boosted by strong growth in the banks＊ net interest income and intermediary business.
ANZ obtains approval to trade in gold futures on the Shanghai Futures Exchange 每 Australia and New Zealand Banking Group (ANZ) has been granted approval to trade in gold futures on the Shanghai Futures Exchange. ANZ will be the second bank to receive such approval after HSBC Bank (China) Co Ltd.
Cross-border Renminbi trade settlement expands and more foreign banks approved for interbank bond market 每 According to reports, China is planning to extend a programme allowing the use of the Renminbi for cross-border trade settlement to the whole country. China has also granted approval to five more foreign banks to participate in its interbank bond market. The five banks include Macau and Malaysian subsidiaries of Industrial and Commercial Bank of China Ltd (ICBC), the Macau subsidiary of Bank Of Communications, Singapore-based Oversea-Chinese Banking Corporation (OCBC) and Fubon Bank (Hong Kong) Ltd.
HK court jails two former ICBC (Asia) staff for accepting bribes 每 A Hong Kong court has sentenced two former ICBC (Asia) executives to jail on the grounds of accepting bribes in exchange for helping a client apply for loans and extending repayment periods.
﹞ China should consider asymmetric rate hikes 每 An officer at the People＊s Bank of China (PBOC), said the PBOC should consider asymmetric interest rate hikes to better balance its economy.
Further, the PBOC said it will continue to make stabilising policy
a top priority of its macro controls in the remaining months of
﹞ Chinese banks may see big funding gaps in next five years 每 According to a former PBOC official, the enhanced requirements of the Basel III guidelines may have a substantial impact on the capital stress on banks. Major Chinese banks will see a capital shortfall of RMB 400每500 billion in five years. ICBC and CCB shares fell to their lowest price in more than two years after these comments.
Sources: Dow Jones Business News, Dow Jones Chinese Financial Wire, China Banking, HKExnews website, China Daily Information Company, International Herald Tribune, M&A Navigator, Philippines News Agency, Reuters News, South China Morning Post, The Financial Times and theflyonthewall.com.
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