Chen Yanqing (陈延庆) of China Cinda Asset Management says that while growth in the non-performing loan balance of Chinese banks has slowed, a stricter regulatory environment could bring more illicit transactions to light in the second half.
China’s official manufacturing purchasing manager’s index has posted a sharp increase for the month of August, contrary to consensus expectations.
All of China’s big four state-owned banks have posted second quarter profits ahead of consensus estimates, as an ongoing regulatory crackdown raises interbank funding costs and widens net interest margins.
Despite the large volume of central bank repos set to mature by the start of September, market liquidity is expected to remain stable in the near-term as China’s fiscal expenditures see an increase towards the end of August.
China’s financial regulators are considering a ban on crowdfunding by means of cryptocurrencies, as authorities in other leading economies step up their scrutiny of initial coin offerings.
A processing error which triggered a sudden spike in one of China’s key benchmark rates has highlighted a lack of transparency at Chinese central bank and the inadequacy of existing measures for communicating policy shifts.
A total of 560 billion yuan in the Chinese central bank’s repo agreements are due this week, triggering market trepidations about near-term liquidity.
The State-owned Assets Supervision and Administration Commission (SASAC) is encouraging China’s central state-owned enterprises by cut debt levels and improve their capital structures via an expanded range of methods, including IPO’s, share placements, asset securitisation and debt-equity swaps.
The personal current account and cash components of China’s money supply have seen a precipitous decline over the past six months in tandem with a sharp increase in personal fixed-term deposits and deposits at non-bank financial institutions, as cashless transactions and money market accounts surge in popularity.
Profit growth of China’s large-scale enterprises for the January-July period edged lower compared to the first six months of the year, while levels of leverage amongst state-owned enterprises saw a slight decline.