China this week - 29 April 2016

Added 29th April 2016

A roundup of the week's asset management news from mainland publications.

China this week - 29 April 2016

Individual-owned mutual fund houses on queue

Huian Fund Management, the first mutual fund manager owned by individuals, was successfully registered on April 25. 

One of the Huian owners is He Bin, who was the deputy general manager of CCB-Principal Asset Management for 10 years until 2015.

More private fund managers are hoping to start their own mutual fund firms. Around 30 other applications are pending approval.

Shanghai Securities News, April 29


Debt issues grow at big banks 

ICBC, the world's largest bank, reported its capital coverage ratio for bad loans fell below the regulatory minimum. 

Bank of China previously reported lower loan-loss coverage.

Analysts and industry insiders said there are signs that, in response, the government is likely ease requirements for the banking industry’s bad loan provisions.

Shanghai Daily, April 29


RMB 60bn onshore bonds on verge of default

More than 50 bonds issued by 40 mainland companies totalling RMB 60bn ($9.27bn) have warned of difficulty in making payments. Most of them are short-dated paper which were issued a year ago.

Concerns are heightened after 14 defaults, involving 27 bonds in total, were reported so far this year. Meanwhile, over 100 bonds totaling RMB 100.9bn have delayed or cancel issuance in April, according to data provider Wind Information.

Yicai, April 28


Banks halted non-gov bond purchase

Some banks have asked external asset managers to stop buying corporate bonds, and only focus on bonds issued by the Chinese government and municipal governments. The benchmark performance is also lowered to about 3.5% from the level at 5.5% last November.

Some managers are also starting to build up or review their internal credit rating system.

21st Century Business Herald, April 28


Free trade zone bond to debut soon

The Shanghai Clearing House plans to launch an offshore RMB bond market in the city’s Free Trade Zone as early as next month. It allows overseas institutional investors with accounts at an international custodian to join. The transaction can be done through an online platform. The proposal was approved by the People’s Bank of China in December last year.

Securities Times, April 27


Analysts warned of vulgar reports

The Securities Association of China said it will impose disciplinary actions on six analysts as some research reports were found to have choice of words that are “subjective, not prudent, over entertaining and vulgarised”.

Some reports use eye-catching titles to attract attention, including “You mum is not your mum, your big dad is still your big dad” from Changjiang Securities, “The Party gives me wisdom and bravery, 5,000 basis points is no dream” by Guotai Junan Securities chief investment strategist Ren Zeping.

Caixin, April 27

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