According to the Central Bank of the Republic of China, total loans outstanding among the overseas business units and branches of Taiwanese banks was NT$1.8trn in 2008: about 11% of total loans, and more significantly a 25% increase in value year-on-year. In the first quarter of 2009, year-on-year growth was 21%. This is a continuation of a trend that started around 2005. “Talking to the banks, most indicate this is one area they want to grow,” said Matthew Smith, a banking analyst at Macquarie

The significance of the basis was amply demonstrated around the second quarter of 2008 when its sharp contraction, due to speculation that the HKMA would break the Hong Kong dollar peg, ground offshore issuance to a halt. Before April 2008 the usual relationship in which US dollar Libor equates to Hibor plus 5bp–10bp at two and three-year tenors held, and this benign relationship prompted HK$33.4bn off issuance from foreign borrowers in 2008, according to data from Thomson Reuters. However, spec

The list of Sino-foreign joint ventures is growing. Credit Suisse, which only gained its full set of approvals for its China JV (Founder Securities) in December 2008, has been printing deals (particularly bonds) almost from the day it became operational. Deutsche Bank, meanwhile, has won permission to establish its China JV, Zhong De, and the final operational approvals are within its grasp. Pretty much everyone else is close to finalising their own ventures. It is a great market to be in. While

Chinese banks unleashed massive credit earlier this year to support the government’s Rmb4trn (US$586bn) stimulus plan (see Economic Outlook story in this report). The China Banking and Regulatory Commission (CBRC) said that lending had reached Rmb4.58trn from January to May. It is estimated that lending was about Rmb1.2trn in June. In total, that would mean the country has already exceeded in the first six months its full year quota of Rmb5trn. Wensheng Peng, Barclays Capital’s director of China

When Want Want China raised NT$3.26bn (US$96.3m) via a Taiwan depositary receipt (TDR), the market yawned. The last TDR issuance stretched back to 2004. The instrument was so rarely traded to be essentially irrelevant. Why would foreign investors want the baggage of Taiwan’s tortuously complicated relationship with China with a listing in Taiwan just to tap into the meagrely traded niche market of TDRs? A listing in Taiwan also exposed issuers to caps on direct investment into mainland China. Ac

Ping An is one of the clearest examples of this universal banking approach. Even before the Shenzhen Development Bank deal, Ping An had been working to change itself from being a leading life and property and casualty insurer to a multi-faceted financial services group. In January 2009 its Shenzhen Ping An Bank arm got approval to be renamed Ping An Bank, reflecting its integration into the rest of the group. It has fast growth in loan, intermediary and retail banking businesses, and has a netwo

China’s property market has been recovering since the beginning of the year thanks to favourable macroeconomic conditions, including low interest rates and falling average property sale prices, and government policies such as encouraging banks to lend to property developers. Riding on this positive sentiment, Chinese property developers are rushing to tap the equity markets for funds. At least seven property companies have sold new shares or convertible bonds in the past three months. These incl

Better still, it looks very much like the worst has already passed. On June 29, Bank of America Merrill Lynch raised its GDP growth forecast for the second quarter of 2009 to 7.5%, from 7.2% year-on-year. The World Bank has raised its full-year growth forecast from 6.5% to 7.2%,and the OECD from 6.3% to 7.7%. “Bolstered by supportive policies and regained confidence in the private sector, China has been recovering faster than the market had expected,” Bank of America Merrill Lynch’s economist Ti

China is having a good crisis. Its economic growth rate may have halved but the Chinese economy is still set to grow at 6.8% this year, a rate that would be blistering almost anywhere else in the world. Hong Kong and Taiwan are not doing as well but the mainland’s strength is a valuable prop. The Chinese government’s policy response to the global financial crisis and the economic stimulus package that is part of that, seems to be working. So much so, in fact, that inflationary fears have started