SAFE eases regulations for special economic zonesMay 24, 2013China's State Administration of Foreign Exchange (SAFE) announced that it will ease regulations of foreign currency transactions for firms operating in special economic zones in the country. The simplified regulations now allow companies to take legal profits derived from exports out of the country, as long as they are located in special economic zones. The new rules, which will take effect in June, will also cut down paperwork requirements and reduce the frequency of regulatory checks.
213 Chinese billionaires join Forbes’ rich listMar 3, 2015China has the second-most number of billionaires in Forbes magazine’s annual list of the world’s richest people in 2015. China accounts for 213 of the total 1,826 billionaires in this year’s list. The US had the most billionaires with 536 while Germany and India took the third and fourth spots with 103 and 90, respectively. This year’s list is still dominated by Microsoft co-founder Bill Gates, who has been the world’s richest man for the 16th year. Gates' net worth rose to USD79.2bn from USD76bn a year earlier, Forbes said. Trailing Gates were Mexico telecoms mogul Carlos Slim Helu, which ranked second with a net worth of USD77.1bn, and Berkshire Hathaway Inc chief Warren Buffett at third place with his USD72.7bn fortune. Wang Jianlin, president of China’s Dalian Wanda Group, occupies the 29th rank in the world, with a fortune of USD24.2bn.
Bank of China joins NZ bankers' associationMar 2, 2015
The Bank of China, one of China's major banks, has become the first Chinese bank to join the New Zealand Bankers’ Association, bringing the total number of member banks to 15. Association Chief Executive Kirk Hope said the arrival of Bank of China further enhances competition and diversity in New Zealand's banking sector. The Bank of China became a New Zealand registered bank in November 2014. The bank’s focus in New Zealand is on international trade, offering corporate banking and financial markets services. Bank of China (New Zealand) Executive Director David Wang said the bank sought to promote economic and trade opportunities between China and New Zealand.
Chinese businesswomen dominate Forbes' Asia listFeb 27, 2015
A total of 14 out of 50 powerful businesswomen in Asia are Chinese women, the latest list released by Forbes' magazine showed. The “50 Power Businesswomen in Asia” showed that Chinese female executives dominate the region. The list includes Maggie Wu and Lucy Peng, two of Chinese e-commerce giant Alibaba's top female decision-makers. The 2015 list is made up of 14 women from China, six from India, five from Thailand, four from Singapore, and three from the Philippines. Businesswomen from Mongolia and Myanmar also appeared on the list for the first time. Forbes Asia said the women in the list are active in the upper echelons of the business world in Asia, wield significant power and have access to robust financial resources.
Alibaba's Ant Financial seeks 2017 IPOFeb 27, 2015
Alibaba's financial arm, Ant Financial Services Group, is considering a domestic IPO in 2017 and is planning to list on A-share market to raise up to USD4bn. Ant Financial, which is currently valued at between USD35bn and USD40bn, launched its first round of funding before the scheduled IPO in 2017, the state-run Shanghai Securities News reported. The company, however, has not made any official statement regarding its listing timetable. According to the report, about 10% of the company will be sold to strategic investors in the private placement, its first round of funding, with candidates limited to firms backed by the Chinese government. Ant Financial owns Alipay, the world's biggest online third-party payment platform.
European business groups seek removal of new China banking security rulesFeb 27, 2015
Technology and banking business groups in Europe have criticised the pending new cybersecurity regulations that the Chinese government said it will impose. The European groups said China's new rules are a disguised technology-transfer programme. Six European business groups have called on the European Commission to keep the Chinese government from applying the new rules, which require banks in China to switch to safe and controllable technologies.
Samsung to start won-yuan direct tradingFeb 25, 2015
South Korean tech giant Samsung Electronics announced in a statement that it was looking into starting won-yuan direct trading, a pronouncement that boosts Seoul's ambition to become a global hub for offshore yuan business. Samsung did not elaborate on its statement but analysts said such a move would be a major boost for the market. South Korea has been encouraging companies trading with China, including Samsung, settle transactions with the yuan or the won rather than the US dollar. Song In-chang, head of the finance ministry's international finance bureau, said that he hoped Samsung's move would influence other big companies.
Postal Savings Bank of China’s IPO could raise up to USD25bnFeb 24, 2015
The Postal Savings Bank of China, one of the country's largest banks by assets and perhaps the world's biggest by branches, is reportedly in talks with potential investors about selling minority stakes before a possible IPO in early 2016. Analysts said an IPO could raise between USD1bn and USD25bn but any stake sales or an IPO would first need a go signal from China's State Council and the Ministry of Finance. The Financial Times reported that the state-owned Postal Savings Bank of China is in talks with potential investors, including an affiliate of Alibaba, US private equity groups and Asian sovereign wealth funds. The bank has close to 40,000 branches all over China and over 470 million retail customers.
Hong Kong analysts report strong income growthFeb 24, 2015
First-year and second-year analysts in Hong Kong have reported strong income growth in the city, while their counterparts in New York said their salaries have stagnated. One Hong Kong-based analyst said the pay in Hong Kong is about USD20,000 higher than in New York. Reports said many financial analysts in Hong Kong are reporting starting incomes exceeding USD90,000, including bonuses. The Financial Services Development Council (FSDC) of Hong Kong said financial jobs in the city are likely to rise by 15% over the next few years. The bulk of the new hires will come from overseas as Hong Kong does not have many hedge funds or private equity talents, said FSDC Chairwoman Laura Cha.
Small Chinese firms get USD10bn in tax breaks last yearFeb 23, 2015
China's small and micro-sized businesses received tax breaks worth Rmb61.2bn (USD10bn) last year, the country's State Administration of Taxation announced. Business income tax of Rmb10.1bn (USD1.62bn) was scrapped from 2.46 million small and micro businesses. Also, enterprises with annual taxable business income under Rmb100,000 (USD16,000) were qualified to a 50% reduction. The Chinese government has expanded preferential tax policies for small firms and reduced their taxes to boost economic growth and employment.
EXIM bank names deputy governor of PBOC as new headFeb 23, 2015
PBOC Deputy Governor Hu Xiaolian has been named the new chairwoman and Communist Party chief of policy lender Export-Import Bank of China (EXIM). A statement posted on EXIM's official website said Hu's appointment is part of the central bank’s reshuffling of high-ranking personnel. Early in February, former Bank of Shanghai Chairman Fan Yifei was appointed to the PBOC's Communist Party committee. The 57-year-old Hu joined the PBOC, the country's central bank, in 2004 as assistant governor.
China to maintain yuan's exchange rate stableFeb 23, 2015
Chinese regulators vowed to introduce mechanism to keep the local currency's exchange rate basically stable this year. The State Administration of Foreign Exchange (SAFE) said it will speed up the yuan's convertibility under the capital account and maintain basic stability of the currency while, at the same time, keeping its exchange rate at a balanced and reasonable level. Guan Tao, SAFE's international payments department head, said that while the yuan has weakened against the green back since the start of the year, China will continue to improve the formation mechanism to keep the exchange rate stable.
Profits of China's brokerage firms reach USD15.78bnFeb 23, 2015
Brokerage companies in mainland China saw a surge in profits last year, boosted by the easing measures from authorities, according to the Securities Association of China. SAC said combined net profits of 120 Chinese brokerage firms totalled Rmb96.55bn (USD15.78bn) -- a 119.34% rise from the previous year. Aggregate revenues of these brokerages reached Rmb260.28bn (USD41.62bn), or a 63.45% increase year-on-year. The country’s A shares raised Rmb724.9bn (USD115.92bn), with Rmb47.1bn (USD7.53bn) raised through the initial public offerings of 94 companies.
World Bank staff cleared of USD1bn China loan caseFeb 20, 2015
The World Bank management has been cleared of any wrongdoing on the alleged mishandling of a USD1bn loan from China, an independent review by an outside law firm said. Law firm Locke Lord Edwards, which was hired by WB President Jim Yong Kim last year to investigate accusations of mishandling, said it found no evidence of fraud or dishonesty. The loan was part of a fundraising exercise for the International Development Association (IDA), the World Bank arm specialising in aid to the world’s poorest people. A question of conflict of interest, however, arose when the International Finance Corp (IFC), one of the World Bank's units, helped China's finance ministry in giving IDA a USD300m grant. The legal review showed that the only problem it found was a lack of clarity about the roles of the World Bank's finance officials and said greater communication is needed.
China's US Treasury purchases soar in 2014Feb 20, 2015
China's purchases of two- to 30-year US Treasury notes soared at the fastest rate last year, keeping yields down while shedding some short-term debt, the Wall Street Journal reported. China’s net rise in buying US Treasury notes and bonds that mature from two to 30 years went up to USD185.683bn in 2014, beating the previous record of USD123.454bn in 2009. China’s overall holdings of US government debt, however, fell by USD25.8bn in 2014 to USD1.2443tr, an indication of huge sales of Treasury bills maturing in 12 months or less. Analysts, however, said China's demand for US bonds will decline in the longer term as the country's domestic capital markets develop and the yuan becomes a global currency.
Volatile capital flows seen this yearFeb 20, 2015
The State Administration of Foreign Exchange (SAFE) said in a report that cross-border capital flows will remain volatile this year due to external and internal uncertainties. SAFE, China's forex regulator, however, said capital flows will soon become normal as the country gradually moves to make its forex mechanism more market-oriented. In Q4 of last year, China's capital account deficit widened sharply to USD91.2bn, raising concerns of massive capital outflows from the country. The deficit was USD9bn in Q3. SAFE, however, assured the public that China's capital outflow remains moderate and within the limit.
China has 8,295 accounting firmsFeb 20, 2015
China's accounting industry, dominated by the so-called big four - PricewaterhouseCoopers, Deloitte Touche Tohmatsu, KPMG and Ernst &Young, has about 8,295 accounting firms that serve more than 2,500 listed companies. According to the Chinese Institute of Certified Public Accountants, China's long list of accounting firms remains dominated by the four globally-renowned firms. Xinhua said of the 8,295 accounting firms in China, only six firms have annual revenue exceeding Rmb2bn (USD326m) and only 46 reached annual revenue of Rmb100m in 2014. Aside from serving listed companies, China's accounting firms also serve more than 4.2 million government enterprises and agencies.
China's commercial bank to face margin pressures this yearFeb 19, 2015
Rating agency Fitch said commercial banks in China are forecast to face margin pressures throughout the year due to repriced loans. In its latest report, Fitch said that while the lower borrowing rates in China will provide short-term relief for borrowers, it will imply thinner net interest margins for banks as deposit competition remains stiff. The People's Bank of China (PBOC), the country's central bank, has confirmed that its efforts to lower borrowing rates are taking effect. Average corporate borrowing rate dropped to 6.77% in December 2014, from 6.97% in September 2014. Fitch said the thinner net interest margins for Chinese banks could encourage them to shift their balance sheets to higher yielding, riskier assets.
Wealth of China’s UHNW population to increase in Year of the SheepFeb 19, 2015
Ultra-high net worth (UHNW) intelligence and prospecting company Wealth-X has projected that China's UHNW population, Chinese people having a net worth of at least USD30m, will add a total of USD80bn to their wealth this year, up 5.2% year-on-year. Wealth-X adds that 60% of the country's UHNW population will reside in first-tier urban cities like Beijing, Guangdong, Shanghai, and Shenzhen by the end of this year. Wealth-X's report was released before the start of China's Spring Festival on 19 February, also the Year of the Sheep.
Xiaomi and Mogujie make it to WSJ’s list of most valuable startupsFeb 19, 2015
With its latest valuation at USD46bn, Beijing-based Xiaomi Inc is now world’s most valuable technology startup. Xiaomi’s current value puts it above other startups that are backed by venture capitalists, which include California-based Uber Technologies Inc, a taxi-booking app with latest valuation at USD41.2bn. Social shopping platform Mogujie of Hangzhou, China is another Chinese startup included in The Wall Street Journal's "Billion Dollar Startup Club". The firm’s latest valuation is at USD1bn. The Journal listed down 73 global firms valued at least USD1bn.
China Development Bank eyes USD2bn in units' HK IPOFeb 18, 2015
China's central government policy bank, China Development Bank (CDB), could raise over USD2bn from the listing of two of its subsidiary units in Hong Kong, according to IFR, a Thomson Reuters publication. The CDB will list CDB Leasing for around USD1bn to USD1.5bn and CDB Securities for around USD500m to USD1bn, IFR reported, quoting unnamed sources. CDB has not issued an official statement regarding the listing. CDB's move is seen by analysts as part of its efforts to expand its international business as growth in China continues to slow.
Shanghai stocks rise over strong performance in transport and new energy car stocksFeb 18, 2015
The Shanghai Composite Index gained 0.76% to 3,246.91 points on the last trading day before the Chinese New Year due to the strong performance of transport and new-energy car stocks. The Civil Aviation Administration of China estimated that 47.52 million people will travel by plane, an 8% rise year-on-year, during the Chinese New Year. According to Sinolink Securities, airline firms had benefited from lower fuel costs and a rising passenger numbers. The civil aviation business is projected to reach a 10% annual growth rate in the next two years, it added.
USD40bn Silk Road fund begins operationFeb 16, 2015The People's Bank of China (PBOC) has announced that the country's USD40bn Silk Road infrastructure fund has already started operations, aiming to boost businesses in countries and regions along the road. The PBOC said the fund acts as a long-term private equity venture partially financed by China's foreign exchange reserves. Investors include China Investment Corp, Development Bank and the Export-Import Bank of China. The fund also aims to resurrect the old Silk Road trading route that once carried treasures between China and the Mediterranean. The Silk Road Fund will welcome investors from Asia and beyond, the government earlier said.
China's ‘big four’ accounting firms settle with US regulatorFeb 16, 2015The Chinese branches of four global accounting firms - PricewaterhouseCoopers, Deloitte Touche Tohmatsu, KPMG and Ernst & Young - paid fines totalling USD2m to settle with the US Securities and Exchange Commission (SEC). The China Securities Regulatory Commission (CSRC) welcomed the settlement reached by the Chinese arms of the four global accounting firms with the US regulator. Aside from paying the USD2m fines, the four Chinese arms of the world's top accounting firms also vowed to provide audit documents for Chinese-US firms to the US SEC. The settlement resolves a year-long dispute over fraud investigations of Chinese companies. The SEC earlier said its investigations have been obstructed by the refusal of the four firms to provide documents for companies listed on the US stock exchange.
Anbang Insurance finalises USD1bn South Korea acquisitionFeb 16, 2015China's Anbang Insurance Corp is finalising its purchase of a controlling stake in South Korea's Tong Yang Life Insurance Co, a deal which will cost the Chinese insurer about USD1bn, Reuters reported. The acquisition will be a first for Anbang in South Korea and could pave way for Chinese acquisitions of other financial firms in the country. Reuters said Anbang is now awaiting regulatory approval for the purchase, which would make it easier for the insurer to buy more financial firms in South Korea in the future. The deal will give Anbang 57.5% share in Tong Yang, the country's eighth-largest life insurer.