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☆ Some Chinese institutions borrow at 50% rate as liquidity squeezed
▼ + stars: | 2023-10-31 | by ( ) www.reuters.com time to read: +2 min

The highest overnight rate for pledged repo - a short-term financing business - hit 50% on Tuesday, according to official interbank data, although the average rate remains modest at roughly 3.6%. Two-day repo rates jumped to as high as 30%, and the highest rate for seven-day repos was 12%. Several traders at small lenders were still seeking to borrow money in later afternoon trading when contacted by Reuters. The brokerage attributed the cash shortage to a "record supply" of government bonds, as well as restricted channels for banks to borrow money. The average seven-day repo rate - a widely watched indictor of short-term borrowing costs in China - remained modest at 2.0765% on Tuesday, meaning many institutions can still borrow money at relatively low rates.

Persons: Thomas White, repos, Fan, Ming Ming, Ed Osmond, Kirsten Donovan Organizations: REUTERS, Rights, Guolian Securities, Reuters, Caitong Securities, Citic Securities, Shanghai, Thomson Locations: China

A man stands near a screen showing news footage of Chinese President Xi Jinping at the China Securities Regulatory Commission (CSRC) building on the Financial Street in Beijing, China July 9, 2021. The China Securities Regulatory Commission (CSRC) has told brokerages to stop offering securities trading from offshore accounts such as Hong Kong to new mainland investors, according to a Sept. 28 notice issued by its Shanghai unit. Activities now considered illegal include cross-border securities broking, securities lending, fund sales and investment consulting, according to the notice. The use of offshore brokerage accounts in Hong Kong entails converting yuan to other currencies. They can also use some foreign brokerage platforms outside mainland China if they have funds parked in offshore locations.

Persons: Xi Jinping, Tingshu Wang, brokerages, Shujin Chen, Guotai Junan, Selena Li, Zhen, Julie Zhu, Sumeet Chatterjee, Edwina Gibbs Organizations: China Securities Regulatory Commission, REUTERS, Reuters, outflows, Jefferies, Citic Securities, HK, Haitong Securities, Hong Kong, Futu Holdings, Fintech Holding, May, Hong, Stock, Hwabao Securities, Thomson Locations: Beijing, China, HONG KONG, Hong Kong, Shanghai, outflows

HONG KONG, July 18 (Reuters) - China's CITIC Securities (600030.SS) plans to move dozens of bankers from its offshore platform CLSA in Hong Kong to the mainland to cut costs and meet Beijing's call to bridge income inequality in the financial sector, people with knowledge of the matter said. The move comes weeks after CITIC cut pay across its investment banking division, lowering base salaries of mainland-based bankers by up to 15%. The move would result in a 25% to 50% base salary reduction because dealmakers in Hong Kong are normally offered higher pay than mainland peers, according to the second person. Wall Street banks such as Goldman Sachs (GS.N), JPMorgan (JPM.N) and Morgan Stanley (MS.N) have cut some investment banking jobs in China over the last 12 months. ($1 = 7.1729 Chinese yuan renminbi)Reporting by Selena Li and Xie Yu in Hong Kong; Editing by Jamie FreedOur Standards: The Thomson Reuters Trust Principles.

Persons: CITIC, Goldman Sachs, Morgan Stanley, Selena Li, Xie Yu, Jamie Freed Organizations: CITIC Securities, CLSA's, Bankers, JPMorgan, Australian, Thomson Locations: HONG KONG, Hong Kong, China, CLSA's China, Beijing, Canadian

China's top graft-busting watchdog earlier this year vowed to eliminate ideas of a Western-style "financial elite" and rectify the hedonism of excessive pursuit of "high-end taste". Industrial and Commercial Bank of China (ICBC) (601398.SS) and China Construction Bank Corp (CCB) (601939.SS) plan to cut some allowances of employees at the banks' headquarters from this year, two sources familiar with the matter said. Domestic rival China International Capital Corp (CICC) (3908.HK) last month cut this year's bonuses for investment bankers by 30%-50% from a year earlier, Reuters has reported, citing sources with knowledge of the matter. Besides anti-corruption crackdown and "common prosperity" drive, financial firms are also reining in the flashy lifestyle of their staff to make sure they are not violating the Communist Party's ideology, said industry officials. China's securities regulator and the central bank cut the budget allocation for employee salaries in 2023, following reforms ordered as part of a broader drive to reduce income disparity, Reuters reported last month.

Persons: Xi Jinping's, CCB, Xin Sun, Sun, Xie Yu, Julie Zhu, Selena Li, Ziyi Tang, Binbin Huang, Rong Ma, Sumeet Chatterjee, Lincoln Organizations: Industrial, Commercial Bank of China, China Construction Bank Corp, Securities, Reuters, China International Capital Corp, HK, Party, King's College London, Thomson Locations: China, HONG KONG, Beijing, Hong Kong, Shanghai

☆ China IPOs are uncoupling from Wall Street too
▼ + stars: | 2023-06-12 | by ( ) www.reuters.com time to read: +2 min

Increasingly it is detaching from Wall Street too. Nonetheless, the Shanghai Stock Exchange will hold a hearing for the deal on Friday, per Refinitiv’s IFR. Syngenta is a pillar in Beijing’s strategy to shore up food security and will use the deal to pay down debt. The landmark IPO coincides with signs that Wall Street’s small position in the market is shrinking further. Syngenta’s blockbuster IPO will be an awkward new milestone for Wall Street already facing life in China’s second tier.

Persons: Beijing’s, It’s, Dealogic, Xavier Niel, Pete Sweeney, Thomas Shum Organizations: Reuters, Agricultural Bank of, Shanghai Stock Exchange, HK, BOC, Citic Securities, Twitter, Brookfield, Thomson Locations: MUMBAI, Agricultural Bank of China’s, Hong Kong, China’s, Una

☆ China's top investment bank CITIC cuts base salary by up to 15% -sources
▼ + stars: | 2023-06-05 | by ( ) www.reuters.com time to read: +2 min

HONG KONG/BEIJING, June 5 (Reuters) - China's CITIC Securities is cutting pay across its investment banking division, lowering base salaries by up to 15%, two sources said, in a rare move in the country's financial sector as Beijing pushes to bridge income disparity. The country's top investment bank by market value has also yet to pay bonuses to bankers for work done last year, the two sources close to the matter said. China's well-heeled financial dealmakers over the past year have been getting a crash course in austerity with pay cuts and perks reined in as their state-owned employers respond to the "common prosperity" drive. CITIC Securities' domestic rival China International Capital Corp (CICC) (3908.HK) last month cut this year's bonuses for investment bankers by 30%-50% from a year earlier, said two separate sources with knowledge of the matter. Besides remuneration cuts, some investment banks have asked staff to avoid displays of wealth such as uploading photographs to social media of expensive meals or overseas trips, industry sources have said.

Persons: China's, CICC, Julie Zhu, Selena Li, Roxanne Liu, Louise Heavens, Kirsten Donovan Organizations: CITIC Securities, China International Capital Corp, HK, Reuters, China's, Thomson Locations: HONG KONG, BEIJING, Beijing, China, CICC, Hong Kong

☆ Farm animals, crops suffer from extreme weather affecting China
▼ + stars: | 2023-06-02 | by ( Laura He | ) edition.cnn.com time to read: +6 min

This year, extreme heat has ravaged many parts of the country even earlier than last year. Animals killedIn recent days, reports of farm animals killed by extreme heat have dominated the news. The pigs suffocated to death amid extreme heat and poor air circulation, Jimu News, a government-owned news website, cited an unnamed employee at the farm as saying. The heat wave was blamed for killing large numbers of farmed carp living in rice fields in the southwestern region of Guangxi. And more extreme weather events are likely to come.

Persons: Sheng Xia, El, El Niño, ”, Sheng, Wang Gang, Niño, Xi Jinping, Shi Guangming Organizations: Hong Kong CNN, China Meteorological Administration, Citic Securities, “, El, World Meteorological Organization, Qiushi, Communist, Villagers, China Today, China Media Group Locations: Hong Kong, China, Yunnan, Sichuan, El, Shanghai, Beijing, Jiangsu, Guangxi, Henan, Pingdingshan, Henan province, Xinjiang

As Japan and the United States place fresh curbs on Chinese technology firms, local investors are scooping up shares of those firms and state companies, and reaping handsome rewards. New fund launches will potentially channel money into China's technology and chipmaking leaders, including ZTE Corp (000063.SZ), Unisplendour Co (000938.SZ), Montage and Cambricon Technologies (688256.SS). Cutting-edge innovation requires huge and long-term investment, which is beyond the ability of private companies, "but SOEs can do it," Yang said. For example, China's chipmaking sector is now trading at 60 times earnings, compared with 16 for the broad market. But "China needs high valuation in some sectors ... Why don't you put down your wager, while also supporting the country's development?"

☆ China brokerage CITIC posts 3.6% rise in Q1 profit
▼ + stars: | 2023-04-27 | by ( ) www.reuters.com time to read: +1 min

SummarySummary Companies Net profits rise to 5.4 bln yuanNet fee and commission income down 10.8% on-yearInvestment income up 89.6% on-yearBEIJING/SHANGHAI, April 27 (Reuters) - CITIC Securities Co (600030.SS), , China's biggest brokerage, reported a 3.6% rise in first-quarter profit on Thursday, thanks to stronger investment returns as the economy recovers. Net profit in the January-March period rose to 5.4 billion yuan ($780.22 million), the company said in a stock exchange filing. The company's investment income surged 89.6% year-on-year to 5.82 billion yuan in the first quarter this year. Its net fee and commission income fell 10.8% to 7.3 billion yuan, the filing showed. ($1 = 6.9211 Chinese yuan renminbi)Reporting by Ziyi Tang and Engen Tham Editing by David GoodmanOur Standards: The Thomson Reuters Trust Principles.

The London Stock Exchange Group (LSEG) (LSEG.L) and UK trade officials visited several cities in China to promote UK capital markets recently. Wilson Xu, a banking veteran from CITIC Securities pioneering the Stock Connect programme, said liquidity will improve when there is a critical mass of Chinese listings. The Shanghai-London Stock Connect was launched in 2019 and the link was expanded last year to include Shenzhen and Switzerland. Even arrangements by SIX to allow roughly 2.5 hours of trading in a session for Chinese GDRs didn't help. Chinese companies, however, have been positive in public disclosures about their forays in Europe which have given them an alternative channel to raise funds and access foreign currency for their operations abroad.

☆ Smaller Chinese banks cut deposit rates on squeezed margins
▼ + stars: | 2023-04-11 | by ( ) www.reuters.com time to read: +3 min

BEIJING, April 11 (Reuters) - Several small and mid-sized banks in China have lowered their deposit interest rates, a move that could help ease costs as loan growth faces more pressure amid rising economic risks. "But the costs of liabilities of banks remain relatively rigid, and net interest margins continue to shrink, which added to their operating pressures," he said. Nicholas Zhu, a banking analyst at Moody's, said smaller banks' pricing changes usually follow larger banks' initiatives with a time lag. In September, China's largest banks lowered deposit rates in their first broad-based move since 2015 to ease margin pressure. Lower deposit rates could also help ease banks' margin pressures at a time when investors have raised their hopes for a cut in lending rates to prop up the economy.

In a filing on Thurday, JD.com said it would continue to hold a stake of more than 50% in the units, JD Industrials and JD Property, upon completion of the proposed spin-off. JD.com said the size and structure of its units' initial public offerings had not yet been finalised. Two sources with knowledge of the floats said the two JD units are seeking to raise $1 billion each in the IPO. In their listing prospectuses filed later on Thursday, JD Industrials and JD Property disclosed annual revenues of 14.1 billion yuan ($2.05 billion) and 2.3 billion yuan, respectively. UBS and Citic Securities are the financial advisers for JD Industrials, while UBS is the financial adviser for JD Property.

BEIJING/SHANGHAI, March 17 (Reuters) - Hong Kong-listed shares in China's Baidu (9888.HK), rebounded 15.7% on Friday as users told of their experiences with the Ernie bot, recouping losses from a day earlier prompted by the chatbot's launch, which failed to impress. One user described on the Weibo social media platform how Ernie had answered a question about the status of Hong Kong philosopher Zhang Jinqing accurately. Analysts also said the initial disappointment the market felt from the launch was tempered by the realisation that the Chinese search engine giant was still best placed to build China's strongest rival to ChatGPT. More than 75,000 corporate users have applied for a trial of an Ernie API developed by Baidu Cloud, the Chinese company said in a video published on its official WeChat account on Friday. Reporting by Eduardo Baptista and Jason Xue; Additional reporting by Brenda Goh; Editing by Muralikumar Anantharaman and Gerry DoyleOur Standards: The Thomson Reuters Trust Principles.

HONG KONG, March 8 (Reuters) - China has announced plans for a national data bureau, describing it as part of an effort to coordinate data resources in the country and to achieve a vision of "digital China" conceived by President Xi Jinping. Xi's vision for a "digital China" aims to see the country populated by smart, internet-connected cities and data treated alongside labour and capital as a key factor to drive the economy and help China compete more effectively globally. In December, China's top leadership published an outline of how China should develop basic data systems and utilize the country's data resources. Last week, they unveiled a new plan that aims for the country to lead digital development globally by 2035. Areas to watch include big data infrastructure, data processing, the digitization of government data as well as data encryption, they added.

In a major shake-up, China will set up the new regulatory body, the National Financial Regulatory Administration (NFRA), according to a proposal that the State Council, or cabinet, presented to parliament on Tuesday. The watchdog, which will oversee all aspects of China's $57 trillion financial sector apart from the securities market, should help reduce regulatory overlap especially at the level of local government, analysts say. There are also plans, sources have said, for the revival of another high-level financial watchdog which is expected to be directly under central party leadership. 'ENHANCING CENTRALISATION'In its reform proposals presented in parliament, the State Council said the changes were meant to "deepen reforming local financial regulatory systems" by "enhancing centralised management of financial affairs". Some investors, however, are concerned that the regulatory power reshuffle means tighter government control, which may bring more interference or crackdowns on financial activity, particularly in the private sector.

HONG KONG, Feb 17 (Reuters Breakingviews) - The disappearance of Bao Fan is a chilling dampener on the reopening of the world's second largest economy. China Renaissance was valued at $2.3 billion in its own IPO in 2018 when it was ranked second on China tech deals per Dealogic. Entities including China International Capital Corp (3908.HK) and Citic Securities (600030.SS), also have to grapple with President Xi Jinping’s common-prosperity campaign, making it unclear whether these firms’ erstwhile generosity will resume when advisory activity picks up. It also noted that in September Chinese authorities took Cong Lin, the bank’s president and chairman of its Hong Kong securities unit, into custody. Column by Yawen Chen in Hong Kong and Una Galani in Mumbai.

☆ Who will be Wall Street’s un-American idol?
▼ + stars: | 2022-12-16 | by ( John Foley | ) www.reuters.com time to read: +8 min

Europeans have been losing the battle against Wall Street’s cozy club for a decade. Deutsche Bank has done the former. BNP has made smaller steps, buying Bank of America’s prime broking business in 2008, then Deutsche Bank’s in 2019. Even with the best intentions, European banks must contend with their own regulators, which affects their ability to take risk elsewhere. JPMorgan, Bank of America, Citigroup, Morgan Stanley and Goldman Sachs together took the top five slots for debt capital markets and merger advisory, as they also did in 2021.

SHANGHAI/HONG KONG, Dec 9 (Reuters) - Investors caught off-guard by China's dramatic COVID policy pivot are betting on both greed and fear as the economy starts to gradually reopen, snapping up shares in businesses from travel agencies and casinos to funeral companies. Providers of death care services, including Hong Kong-listed Fu Shou Yuan International Group (1448.HK), China's biggest cemetery operator and funeral service provider, have also drawn investors. The positioning for both the bright and dark side of China's COVID pivot reflects growing concerns from investors surprised by the rapid policy change, especially as COVID vaccination rates among the elderly remain relatively low. "But we still think that the way China can flatten the curve of new COVID cases without doubling down on tightening looks quite challenging." Morgan Stanley Chief China economist Robin Xing said China's economy may remain sluggish for another quarter or two, but growth will pick up after Spring.

☆ China property sector surges on fundraising support, but COVID protests cloud outlook
▼ + stars: | 2022-11-29 | by ( Xie Yu | Jason Xue | ) www.reuters.com time to read: +5 min

The move is the latest regulatory easing as Beijing steps up support for the property business, a sector that accounts for a quarter of the Chinese economy. Yuan-denominated bonds issued by Chinese developers CIFI Group, Guangzhou Times Holdings, Country Garden rocketed between 20% and 50% each on Tuesday. “Most of the funding channels the property developers need are covered now,” said Gary Ng, senior economist at Natixis. “It is now up to whether the market, or basically the state players will actually support the sector,” he said. If funds could be raised from state-backed investors, there will be meaningful consolidation in the property sector, Ng said.

☆ Chinese automaker Geely's new energy brand Farizon raises over $300 mln
▼ + stars: | 2022-10-26 | by ( ) www.reuters.com time to read: +2 min

BEIJING/HONG KONG, Oct 26 (Reuters) - Chinese automaker Geely's new energy vehicle subsidiary on Wednesday said its brand Farizon has raised over $300 million from a funding round led by Asian logistics firm Global Logistics Properties' (GLP) investment arm Hidden Hill Capital. The new capital raise, which involves other investors such as Chinese logistics and chemical group Transfar and an investment firm backed by major Chinese investment bank CITIC Securities, came as Geely stepped up its new energy vehicle development. Hangzhou-based Geely Holding Group, owner of Zhejiang Geely New Energy Commercial Vehicle Group which sells Farizon, is known globally with its investments in Volvo Cars and Mercedes-Benz. Farizon will use much of the funding "for research & development and ecosystem development, in order to further consolidate its market-leading position in new energy commercial vehicles," Zhejiang Geely New Energy Commercial Vehicle Group said in a statement. Geely New Energy Commercial Vehicle did not disclose Farizon's valuation in the statement.

☆ EXCLUSIVE Kaisa offshore creditors offer $2 bln to take over stalled projects - sources
▼ + stars: | 2022-09-19 | by ( Clare Jim | ) www.reuters.com time to read: +5 min

A sign of the Kaisa Holdings Group is seen at the Shanghai Kaisa Financial Centre, in Shanghai, China, December 7, 2021. It also comes as authorities are scrambling to contain a mortgage boycott by homebuyers against stalled projects. The offshore bondholder group, which is being represented by financial advisory group Lazard Ltd, made the offer to acquire Kaisa's stalled projects to the developer's advisor CITIC Securities, said the people. As most of Kaisa's projects are in top-tier Chinese cities, where housing prices are relatively resilient, bondholders expect to reap the profits after the completion of the stalled projects, said the two people. It is unclear how many stalled projects would be covered by the bondholder group's offer, and how many of them meet the purchase criteria laid out by the group.

☆ Exclusive: Kaisa offshore creditors offer $2 billion to take over stalled projects
▼ + stars: | 2022-09-19 | by ( Clare Jim | ) www.reuters.com time to read: +5 min

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