Goldman Sachs, ICBC get approval for wealth management tie up
On May 25, the Industrial and Commercial Bank of China Ltd. (ICBC) said that it had received preliminary approval from the China Banking and Insurance Regulatory Commission (CBIRC) to set up a wealth management joint venture with Goldman Sachs Group Inc…
CBIRC exempts locally incorporated foreign banks from rules on large exposure caps related to parent companies
This notice is part of a broader move by China’s regulators to bring their regulatory frameworks and practices more into line with international standards. The new exemption for locally incorporated foreign banks aligns China with the standards introduced by the BCBS in 2014 in its supervisory framework for measuring and controlling large exposures…
INE set to introduce first yuan-denominated crude options available to overseas investors
The introduction of crude options contracts and allowing overseas institutions to trade is yet another measured step in China’s financial opening. Insufficient access to derivatives has long been a complaint of foreign investors looking to hedge their exposures…
CBIRC announces pilots to encourage private pension provision
China has been talking about overhauling its creaking pension system for at least 20 years, and while there have been changes, they have been far too cautious and limited to tackle what is an increasingly urgent problem. The government has been slow to open up the corporate annuity market and even slower to develop the personal pensions market, which is now becoming a top focus…
BlackRock wealth management joint venture cleared to open for business
Foreign asset managers are slowly establishing a presence on the mainland. As of now, that presence remains small…
CBIRC issues new licensing system for financial institutions
On May 7, the China Banking and Insurance Regulatory Commission (CBIRC) issued the “Banking and Insurance Institution Licensing Administrative Measures” which updates regulations on its financial licensing system with the aim of consolidating and simplifying it…
Guangdong government highlights financial development measures for GBA
On April 25, the Guangdong provincial government released a draft of the province’s “14th Five-Year Plan (2021-2025) for Economic and Social Development and the Long-range Objectives Through the Year 2035.” The draft plan outlines several goals related to the financial development of the Greater Bay Area (GBA) in general and of Guangdong province in particular…
NPC deliberates Futures law
As in other areas of its financial markets, China is trying to balance greater liberalization of derivatives trading with sufficient regulation to maintain overall financial stability and offer ample protection to investors. The draft Futures Law is an attempt to put guardrails in place to guide the further development and opening of the derivatives market…
Beijing expands QFLP program
The expansion of Beijing’s QFLP program is part of a broader push to open up the services sector in Beijing. In September 2020, the State Council approved a plan, formulated by the municipal government and the Ministry of Commerce, to set up demonstration zones and pilot programs to further open the capital’s services sector. The plan included liberalizing the scope of public market investment through the QFLP pilot program…
PBoC, NDRC and CSRC release unified catalogue of industries and projects eligible for green bond funding
The updated Catalogue is a major step forward in implementing China’s climate change commitments to reach peak emissions by 2030 and carbon neutrality by 2060. Bringing the three regulators together behind one set of classifications and rules is no mean feat –– having one single reference point will have a significant impact on the domestic green bond market and play a key role in helping Beijing ramp up its support for green finance…
PBoC releases updated anti-money laundering measures
Aside from complying with the requirements of the FATF, the PBoC’s efforts to upgrade and improve anti-money laundering regulations are also key components of the government’s financial derisking campaign and efforts to combat financial crime. The inclusion of nonbank financial institutions (NBFIs) in the regulations is aimed at addressing the criticisms in the FATF’s evaluation report, and ensuring that they are subject to the same level of regulatory supervision as banks and have adequate internal control systems and risk management policies in place…
CBIRC issues measures to encourage lending to micro and small enterprises
Inclusive finance has been high on the government’s agenda for several years as it works to improve financial support for groups traditionally underserved by banks who see them as less financially rewarding and riskier. MSEs have long been shunned by banks partly because they have little collateral to pledge when they apply for loans, hence the CBIRC’s emphasis on promoting the use of movable property as security…
Guangdong regulators issue draft rules for GBA wealth connect program
Once implemented, the WMC will be a major step forward in the financial integration of the GBA. However – as indicated by the draft rules – regulators will initially take a conservative approach to managing money flows within the region…
PBoC tells interbank bond market agencies to improve access and services to foreign institutional investors
Foreign investors have been pouring money into China’s bond markets over the past two years for four reasons. First, regulators have allowed greater access. Second, CGBs have started to be included in global benchmark bond indexes …
CBIRC seeks feedback on proposals to expand personal insurance market for the elderly and children
Demographic and economic trends are set to put significant pressure on the country’s fiscal resources Policymakers’ drive to develop commercial insurance into a key supplement to existing social safety nets is an attempt to address these pressures. The special focus on providing adequate elderly care through commercial channels reflects concerns about the sustainability of China’s overburdened pensions and social welfare systems …
PBoC appoints new deputy governor with an eye to IMF role
Promoted to his second vice-ministerial position at the age of 48, Li has all the hallmarks of a rising star in China’s financial system. There is speculation that Li’s appointment is a prelude to him taking a top job at the International Monetary Fund (IMF) …
CSRC revises pre-IPO evaluations for STAR Market
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Citigroup to seek license for new wholly owned securities business
Rules on foreign ownership of securities businesses were eased in 2020, after which several foreign lenders,including JPMorgan Chase & Co.; Goldman Sachs Group Inc.; and Credit Suisse Group AG, gained approval from regulators to take majority ownership of their securities joint ventures. Most are now seeking to increase their stakes further, with some aiming for 100% ownership …
CBIRC approves DBS Bank’s purchase of stake in Shenzhen Rural Commercial Bank
In the early 2000s, as China cracked open the door to its financial services sector, a few foreign banks took the plunge and bought big stakes in Chinese city and rural commercial banks. But those forays didn’t work out well as the foreign banks struggled to influence the local management and were frustrated by cultural differences …
Guangzhou Futures Exchange officially opens
The GFE is the country’s first new futures exchange to open in 14 years and is one of the key financial initiatives in the Greater Bay Area master plan. Launching an exchange without any clarity about what exactly will be traded is somewhat unusual and disappointing …