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 …
Governor Yi Gang reiterates PBoC’s commitment to green finance
This is the third public speech Yi has given in less than a month focused on climate change and green finance, reflecting the importance the central bank is now attaching to the issue in the wake of Xi Jinping’s pledges last year to reach peak emissions by 2030 and carbon neutrality by 2060. Yi’s repeated statements drive home the message that the central bank is serious about making an impact on carbon emissions and the environment through the financial system …
CSRC chairman flags risks of ‘hot money’ to stability of domestic capital markets
Yi’s wide-ranging speech gives us good insight into what’s on the mind of stock market regulators – and there’s plenty to keep them occupied. Yi isn’t the first regulator to publicly express concern about the potentially destabilizing impact of hot money on China’s capital markets – on March 2, banking regulator Guo Shuqing warned that the aggressive stimulus policies undertaken by many developed countries were fueling asset bubbles that could spill over into China’s financial markets …
CBIRC issues rules to improve management of bank liabilities
The new rules are consistent with other regulatory efforts to improve oversight of bank funding as part of a broader campaign to de-risk the financial system. Still, the new measures will not cause a big headache for most banks, although some smaller lenders that rely on regulatory workarounds to meet their funding needs might struggle in the short term …
Reports say SAFE to expand QDLP outbound investment program to Guangdong province
Over the past few months, financial regulators have repeatedly said that they intend to pursue further two-way opening of China’s capital account this year. With so much foreign money flowing into the mainland bond market, Beijing sees a window of opportunity to cautiously open the outbound capital spigot …
PBoC steps up anti-money laundering regulations with revisions to Know Your Customer rules
Members of the FATF are required to meet certain standards and obligations, and the 2019 report, which exposed serious shortcomings in China’s anti-money laundering regulatory framework and enforcement, was a wake-up call for China’s financial regulators to get their act together …
PBoC, CBIRC publish draft regulations for systemically important banks
These draft rules are the latest in a series of new regulations aimed at complying with international standards set by the Financial Stability Board for systemically important financial institutions and banks. Having basically set the rules for China’s G-SIBS, regulators are now turning to the more complex and troublesome D-SIBS who are financially weaker and more likely to struggle to raise capital …
PBoC issues rules governing hiring of senior executives at financial holding companies
These interim provisions are the latest in a long line of policies aimed at boosting regulatory supervision for companies with operations in financial services, which had hitherto operated with insufficient regulatory oversight. The fact that authorities have been gradually building up the regulatory framework and scrutiny over the appointment of senior personnel is seen as a crucial part of these efforts …
PBoC to allow Hainan greater yuan convertibility rights as part of package to promote financial liberalization in the province
The Hainan FTP is a pet project of Xi Jinping, who is reported to have personally designed, arranged, and promoted it and called on the government to support “daring reforms and innovation.” As a result, the project is as much a political task as an economic one and all ministries and agencies are compiling action plans related to the areas under their jurisdiction …
Top policymaking body signals tighter government grip over big tech
Top leaders want to harness the power of China’s hugely successful platform companies while also ensuring that they are subject to strict regulatory oversight. The meteoric rise of internet giants like Alibaba Group Holding Ltd. and Tencent Holdings Ltd …
PBoC Governor Yi Gang elaborates on green finance, climate change challenges
The CDF is an annual event hosted by the State Council’s top think tank, the Development Research Center. Its primary purpose is to enhance communication with foreign governments and business communities …
PBoC proposes new rules for credit rating agencies as part of sector shakeup
These regulations are part of a long march to clean up problems in the bond market, implement the government’s commitment to ending the implicit guarantee that defaulting corporates will get a bailout, and develop markets where risks are correctly priced and investors bear the cost of defaults. China needs to develop a deep and liquid bond market to provide financing for its corporate sector and decrease dependence on the banking system for credit …
Innovation shoots to the top of the economic priority list at Two Sessions
The centrality of innovation to the future of China’s economy emerged as a major theme of the Two Sessions. China’s leaders see developing new technologies as key to the economy’s medium and long-term sustainability. It is also increasingly viewed as a…