29 Jun 2023

HKEX launches Dual Counter Model

This is the latest effort by Beijing to broaden the supply of RMB-denominated investment products available offshore as part of its long-term strategy to internationalize the Chinese currency…

29 Jun 2023

Hengqin, Nansha, and Qianhai look to incentivize offshore fund investment

Now that China has reopened after three years of strict COVID controls, smaller cities and less developed zones within the GBA, are stepping up action to ensure they make progress on one of Xi Jinping’s pet initiatives. Despite geopolitical tensions, policymakers still view foreign capital as vital to developing the mainland part of the GBA and, more broadly, to China’s overall economic and “green” development and efforts to move up the value chain…

29 Jun 2023

Hong Kong insurers see boom in sales to mainland visitors

The strong rebound in sales is hardly surprising given the difficulty that mainland residents faced in traveling to Hong Kong during the implementation of China’s zero-COVID policy. Moreover, insurance products will continue to prove attractive as mainland consumers look for stable, low-risk investment vehicles amid rising global interest rates and increasing economic uncertainty in China…

26 Jun 2023

PBoC solicits opinions on increasing oversight of bond valuation industry

At their core, these measures are about formalizing the structures behind bond pricing and price discovery. The current lightly-regulated, largely informal valuation system begets a lack of transparency that can lead to mispricing, which, in addition to injecting uncertainty and risk into the financial system, makes investors less confident in the bond products they are buying…

22 Jun 2023

Fang Xinghai delivers speech highlighting financial reform and opening progress

In his speech, Fang talked a lot about what has been done and said nothing about what will be done. In regards to the opening policies that Fang mentioned, we expect more experimentation with RMB internationalization through Hong Kong capital markets and that select Chinese companies will continue to raise capital via GDRs…

22 Jun 2023

PBoC cuts LPR rates

The LPR cuts will help ensure access to cheap credit for businesses and households. But credit supply isn’t the problem, credit demand is the problem – and that’ll remain low until consumer and business confidence returns…

22 Jun 2023

Beijing approves long-awaited PE industry regulations

As policymakers double down on channeling more capital toward tech innovation, it’s no longer tolerable for the PE industry to oversee itself…

16 Jun 2023

Second-tier banks cut deposit rates

It’s not entirely clear what financial authorities want to achieve here. Do they want to bolster banks’ profits, which have been squeezed by narrowing margins? Or are they laying the groundwork for lower lending rates by first reducing bank funding costs?

16 Jun 2023

PBoC cuts MLF rate

Interest rate cuts may help those parts of the economy that are overly indebted and struggling to meet their financial obligations – namely local governments and property developers, but it will do very little for the broader economic recovery…

16 Jun 2023

PBoC cuts SLF rate

When taken with large banks’ coordinated reduction in deposit rates this month, it’s clear that authorities are lowering bank funding costs as a prelude to reducing lending rates for end-borrowers…

15 Jun 2023

New financial regulator disclosed its immediate work priorities

The NFRA has inherited the duties of its predecessor, the CBIRC. However, Zhang’s comments could be our first insight into what additional priorities the NFRA is focused on…

15 Jun 2023

The police force vows to strengthen the fight against securities crime

The MPS isn’t the only government agency that wants to root out financial sector malfeasance. Li Xi, the new anti-corruption czar, has put the financial sector on notice that it is in for greater scrutiny from the anti-corruption watchdog (CCDI) on his watch…

15 Jun 2023

Issuance of special-purpose bonds to recapitalize banks surges in 2023

Sluggish credit growth and a slowdown in bad loan disposals meant banks had little need to recapitalize last year. However, the rapid expansion of credit in Q1, plus expectations that banks may have to lend more to support the economic recovery, means some banks now need to recapitalize…

14 Jun 2023

Former PBoC deputy governor charged with corruption

Rooting out good old-fashioned bribery and influence-peddling is still at the top of the Party’s agenda. But investigations are increasingly focused on officials’ failure to pursue the Party’s interests, such as ensuring finance serves Beijing’s development priorities…

14 Jun 2023

Why vice premier He Lifeng is in a strong position to implement economic and financial policy

Liu He’s biggest weakness was that he lacked a team of enforcers to implement policy effectively. He Lifeng faces no such obstacle, making the quality of policy more important than ever…

14 Jun 2023

PBoC cuts reverse repo rate

Taken in isolation, a 10 bps cut in the reverse repo rate won’t significantly impact bank funding costs or loan demand, but it sends a strong signal to the markets that policymakers want borrowing costs to fall…

10 Jun 2023

Top financial officials outline key goals at Lujiazui financial forum

The discussion at Lujiazui is high-level and broad brush, and officials offered little new in terms of policy trajectory…

06 Jun 2023

China, EU launch second phase of common green finance taxonomy

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01 Jun 2023

May foreign financial institution approvals and specific financial opening developments

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30 May 2023

GBA Wealth Connect revamp to expand investor access to global equities

The GBA WMC has generated significant interest from banks and investors alike since its launch. With zero-COVID finally in the rearview mirror, Hong Kong authorities are eager to leverage the GBA WMC to aid the city’s economic recovery and to reassert its status as a world-class financial hub…

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