#CNflow 2016.03.07-11

Tracking shadow banking + liquidity relations in China

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Reuters – China’s shadow-bank boom keeps zombie firms alive | Considered View | Breakingviews

 China’s shadow banking sector is piling up risk at the heart of the financial system and keeping deadbeat firms alive. The sums invested in so-called wealth management products surged 57 percent last year to reach $3.2 trillion. The growth alone is good reason to worry, but new data also suggests much of the cash is propping up troubled borrowers.

Bank acceptance bills, newspapers and fraud in China | FT Alphaville

 This is CreditSights summarising CBRC notice #203 which is officially dated Dec 31 2015, before those alleged scams above were announced. It complained of seven risks in the bill financing game:

1). Poor internal controls, failure to check that counter­party is on the accepted name list, illegal provision of repo financing.

2). Artificial sales to remove discounted bills from the balance sheet.

3). Using bills to inflate loans, deposits and fees.

4). Banks cooperating with middle­men to issue bills without real underlying exchange of goods.

5). Using bills to borrow new funds in order to refinance maturing loans, thus distorting asset quality.

6). Use of proxies, ‘drawer agreements’, or middle­men to hide discounted bill assets.

7). Certain joint-­stock and city commercial banks using agricultural FIs (such as rural commercial banks or rural credit cooperatives) as ‘channels’ to reduce on balance sheet assets.

Reuters – Exclusive: China to allow commercial banks to swap bad debt for equity stakes in firms – sources

 China’s central bank is preparing regulations that would allow commercial banks to swap non-performing loans of companies for stakes in those firms, two sources with direct knowledge of the new policy told Reuters.

Caixin – Executive at Heart of Bad Loan Guarantee Scandal Said to Be Detained

 (Beijing) – An executive who oversaw a troubled 50 billion yuan lending program at a loan guarantee company has been detained by Communist Party graft busters, a person with knowledge of the probe says. Li Lingcheng was taken away by investigators from the party’s graft buster, the Central Commission for Discipline Inspection, on February 17, the source said. Li was once president of Hebei Financing Investment Holding Group Co. Ltd. and later served as its party boss. The person with knowledge of the probe said that as president he oversaw a program by a subsidiary of the group called Hebei Financing Investment Guarantee to back loans extended by banks, asset management firms, trust companies, securities firms and peer-to-peer lending websites. The loans mostly went to companies in the northern province of Hebei.

PBOC’s Yi Reveals Some Non-Dollar Reserves in Transparency Bid – Bloomberg Business

 Foreign exchange reserves held by the People’s Bank of China include the euro, yen, pound and developing nations’ assets, in addition to U.S. dollars, Deputy Governor Yi Gang said at a news briefing in Beijing on Sunday. He did not disclose amounts of holdings in the currencies.

PBOC Using Stealth Intervention as Reserves Decline, Daiwa Says – Bloomberg Business

 The People’s Bank of China may have bought foreign currency from local banks, used the forwards market to prop up the yuan and asked the nation’s sovereign wealth fund to liquidate overseas assets, Daiwa analysts Kevin Lai and Junjie Tang wrote in a note on Tuesday. While Lai didn’t provide any direct evidence in the note, he said in an e-mailed response that his conclusions were based on a “logical deduction.”

PBOC executes Rmb30bn 7-day reverse repo, closed out previous Rmb230bn reverse repo 央行今操作3百亿7天期逆回购

 中国央行公开市场今日将进行300亿元7天期逆回购操作。另外,公开市场今日有2300亿元7天期逆回购到期。7天,300亿元,2.25%。

PBOC has almost taken back extra Rmb1.69tn of liquidity issued in open market operations over Chinese New Year 央行已基本收回节前投放资金

 本周通过公开市场操作净回笼资金2050亿元人民币(315亿美元),四周净回笼总额达到1.58万亿元,接近上月春节前净投放的1.69万亿元。

PBOC Governor Zhou Xiaochuan: Need to develop self fundraising channels (e.g. bonds, equity) to reduce corporate debt/leverage 周小川:发展直接融资降杠杆

 央行行长周小川3月11日表示,在金融领域,去产能和去杠杆可以协同推进。他说,我国杠杆率过高,相当一部分表现在工业企业。如果高杠杆无法解决,企业调整、整合的难度也会很大。他认为,需要发展直接融资,减少债务杠杆,这有利于企业重组。

Reuters – China February new loans pull back sharply after January splurge

 Chinese banks extended 726.6 billion yuan ($111.80 billion) in net new yuan loans in February, missing analyst expectations and falling from the previous month’s lending of 2.51 trillion yuan. The central bank said the broad M2 money supply measure (M2) grew at 13.3 percent from a year earlier, missing forecasts. Outstanding yuan loans grew at 14.7 percent by month-end on an annual basis.

3 month SHIBOR touches five year lows 中国3个月Shibor刷逾五年新低

 中国3个月Shibor跌0.7个基点,报2.8070%,连跌七日,创2010年10月25日来的低点。中国1个月Shibor跌不足1个基点,报2.6830%,连跌七日,为2015年8月14日来的低位。

CBRC chairman Shang Fulin: Need to strengthen P2P industry supervision 尚福林:将加强对P2P行业监管

 银监会主席尚福林表示,银行业要更加注重防范各类风险。当前非法集资的形势严峻。加大防范非法集资的力度。非法集资案件处于高发频发阶段。银监会将继续加强对P2P行业的监管,加强互联网金融专项治理。参与投资时要注意对象、回报、营销三方面的风险。

Reports CBRC orders commercial banks to strictly control property credit risks 传银监会要银行严控楼市风险

 中国银监会要求,股份制银行严控产能过剩行业风险,及早制定处置和应急预案;严防房地产信贷风险,加强对三四线城市以及商业用房等重点市场风险形势研究;关注互联网金融、股票、债券等市场风险对银行流动性的联动效应;探索不良资产处置方式创新,提升不良资产市场化、多元化、综合化处置能力;在风险可控前提下可通过收回再贷、展期续贷、并购重组等方式,帮助暂时性经营困难企业渡过难关。银监会支持引导具备条件的股份行探索开展投贷联动试点。【相关新闻】结合一些平台的首付贷的数据,目前预计深圳的首付贷存量为20亿-30亿,这是个保守的估计。加上线下我们无法统计的数据,深圳首付贷实际数据估计至少比这数目多一两倍。

China Opens Up Its Bond Market | Seeking Alpha

 In another step toward liberalization, China has opened up its RMB48.37 trillion onshore bond market to foreign institutional investors. Prior to this announcement, onshore bonds were limited to institutions such as sovereign wealth funds, central banks and multilateral finance institutions such as the World Bank and the IMF. Post onshore bond market liberalization, foreign investors will no longer be limited by QFII (Qualified Foreign Institutional Investor) and RQFII (Registered Qualified Foreign Institutional Investor) quotas.

Guangdong province sets up a municipal bond risk monitoring system 广东:建立地方债风险预警机制

 据广东省人民政府网站消息,《广东省政府性债务风险应急预案(试行)》于近日印发,要求各地区政府举债不得突破上级批准的限额,建立地方政府债务风险预警机制,有效控制全省债务规模,并逐步将政府债务分类纳入预算管理。文件规定,政府逾期债务率在10%到20%之间,或者政府确定应承担的或有债务和其他债务偿还责任超出本级政府筹资能力,但偿债缺口未达到上一年度公共预算收入的1/12 的,为初级债务风险;政府逾期债务率在20%到50%之间,或者偿债缺口达到上一年度公共预算收入的1/12以上(含),但不足1/6的,为中级债务风险;政府逾期债务率在50%以上,或者偿债缺口达到上一年度公共预算收入的1/6以上(含)的,为高级债务风险。

Rmb5tn of local government debt due to mature this year, swapping old debt for new bonds 5万亿到期地方债务可借新还旧

 对于舆论关注的地方债务风险问题,楼继伟说,关键在于规范债务管理。去年全国人大核准了地方债务余额16万亿,其中15.4万亿是2014年底以前的地方债务存量。存量债务中只有1万多亿是经过全国人大批准过的债券,剩下都是非规范的债务。他表示,今年统计的地方到期债务还有5万亿左右,继续允许地方发行债券置换到期的债务。以后年度还有到期的,只要在债务余额之下,地方可以借新还旧不是大问题。楼继伟指出,当前大的问题,一是要控制好那些或有债务,在经济增速放缓的时候需要地方政府代偿的比例可能扩大,包括地方融资平台上承担的政府或有债务;二是要防止利用各种方式变相发债,规范PPP项目,防止地方变相借债。“如果把债务的风险控制住,不会给经济造成大的伤害。”

Since its launch in 2013, 7,110 PPP projects worth Rmb8.3tn have been signed 中国PPP大数据:投资8.3万亿

 数据显示,自2013年推行PPP项目以来,截至2016年2月29日,全国各地共有7110个PPP项目纳入PPP综合信息平台,项目总投资约8.3万亿元,涵盖了能源、交通运输、水利建设、生态建设和环境保护、市政工程等19个行业。

Property developer onshore bond issuance in Jan, Feb increased three-fold year on year 地产债前2月发行同比增3倍

 在新一轮房产政策的刺激下,去年政策松绑后发行大跃进的地产债,今年的发行热度仍在延续。相关数据显示,今年1、2月份,房地产公司在岸债供发行近800亿,是去年同期的4倍。

CPPCC member calls for easing SME borrowing difficulties in China 委员:有银行贷款须给回扣

 全国政协委员刘卫昌在关于缓解中小企业融资难的提案中,呼吁破解融资难,让中小微企业共享金融的阳光雨露。一、大力发展面向小微企业和“三农”特色的中小金融机构。二、切实抓好国家金融支持小微企业发展有关政策的督促落实。三、大力加强对中小企业在融资方面的服务。

China Internet Finance Association issues new guidelines for P2P platform operations 官方制定P2P信披自律规范

 按照澎湃新闻此前获得信息,中国互联网金融协会将于3月25日在上海挂牌。在《规范》的第五章,严格规定了个体网络借贷(P2P)项目信息披露的内容,要求每天更新至少21项平台运营信息,涉及交易总额、交易总笔数、借款人数量、投资人数量、人均累计借款额度、笔均借款额度、人均累计投资额度、笔均投资额度、贷款余额、最大单户借款余额占比、最大10户借款余额占比、平均满标时间、累计违约率、平台项目逾期率、近三月逾期率、借款逾期金额、代偿金额、借贷逾期率、借贷坏账率、客户投诉情况、借款人经营状况等。

Ping An total bad debts increased by almost 70% in 2015 平安银行不良贷款余额增近7成

 更受关注的是,银行业资产质量的持续恶化。2015年末平安银行不良贷款余额为176.45亿元,同比增长68.03%;而不良贷款率为1.45%,同比上升了0.43个百分点。平安银行次级类贷款余额79.45亿元,同比增长81.64%;损失类贷款余额75.59亿元,同比更是增长了89.88%。

China Said to Plan Crackdown on Loans for Home Down-Payments – Bloomberg Business

 Chinese regulators plan to impose new rules to end the practice of homebuyers taking out loans to cover down-payments, as they step up scrutiny of financing risk in the property market, according to people familiar with the matter. The rules will bar lenders including developers, housing agencies, small-loan companies and peer-to-peer networks from offering loans for down-payments, said the people, who asked not to be named because the matter isn’t yet public. Regulators including the central bank and the China Banking Regulatory Commission will also ask commercial banks to scrutinize mortgage applications and reject those where down-payments come from loans offered by such institutions, the people said.

P2P funding for mortgage downpayment loans less than Rmb5bn 首付贷规模曝光:P2P不到50亿

 结合一些平台的首付贷的数据,目前预计深圳的首付贷存量为20亿-30亿,这是个保守的估计。加上线下我们无法统计的数据,深圳首付贷实际数据估计至少比这数目多一两倍。

Only 0.6% of P2P platforms partner with insurance companies P2P平台牵手保险难增信

 截至2016年2月,累计P2P平台数3944家,与保险公司合作的P2P平台至少有92家,而合作履约保证保险的平台仅为21家,占比不到0.6%。

Total number of P2P platforms declines for third straight month P2P平台数量连续三月负增长

 P2P平台数连续三个月负增长,截至2月底,全国正常运营平台共2707家。原因是问题平台数量依然保持高位,而新增平台数量虽然显著下滑,但问题平台数则连续三个月超过新增平台数。

Lufax Vice President resigns after less than a year, reflects growing pressures in China’s online finance industry 陆金所副董事长杨晓军离职

 “铁打的营盘,流水的兵”,商业银行、监管层大佬频频出走加盟大型互联网金融平台,而这些平台也陷入了留不住人的尴尬。任职不足一年,银监会创新部原副主任、陆金所副董事长杨晓军将从陆金所离职,而他的新去处是玖富集团。昨日,北京商报记者从玖富相关人士处证实这一消息。

Shenzhen had 10 net loan platforms run into trouble in February 2月深圳爆出10家问题网贷平台

 盈灿咨询最新出炉的网贷行业2月份月报显示,截至2016年2月底,深圳市正常运营的平台数为350家,较上月减少9家,下降幅度较上月的1.1%翻了一倍多,为2.51%;同期广东省正常运营平台数量为461家,较上月减少9家平台。深圳占广东省正常运营平台数量的75.92%,是广东网贷平台的主要分布区。

Marbridge Daily: Rumor: Sesame Credit Starts CB of Enterprise Credit Service

 Consumer credit rating service provider Sesame Credit, a subsidiary of Alibaba Group’s (NYSE: BABA) financial services affiliate Ant Financial, recently started closed beta testing for an enterprise credit service, according to a source connected to the company. 

Ant Financial (Alibaba’s micro finance services firm) value estimated at US$50bn 蚂蚁金服

 《华尔街日报》报道,知情人士称,阿里巴巴关联公司蚂蚁金服新一轮融资计划筹集至多30亿美元资金,投资者包括保险商、政策银行及国家基金。据称,蚂蚁金服正就融资事宜与建银国际进行商谈,料在4月中旬完成融资。知情人士称,新一轮融资后蚂蚁金服估值将接近500亿美元。

Warnings of unofficial bank WMPs being sold in Shanghai 沪银行业:银行理财产品无代销

 上海市银行同业公会3月8日发布关于防范非法集资的声明称,银行并没有与第三方理财机构合作,银行理财产品仅通过银行自身渠道销售,没有委托任何单位代销。

Lehman Lawyer to China Distressed Debt Holders: Expect Pain – Bloomberg Business

 Investors betting on troubled Chinese companies could be waiting some time for their salvation, according to U.S. law firm Jones Day. Debts tied to battered commodities and a lack of legal protections for offshore creditors will pose significant challenges for recovery of monies owed, said Jayant W. Tambe, a New York-based partner who is representing Lehman Brothers Holdings Inc. in derivatives lawsuits after its collapse. Clients are still “not so comfortable” about emerging markets even as raw material prices rebound recently from multi-year lows, he said.

Mining firms issuing AAA bonds with rates as high as 6% 煤企AAA债发行利率高达6%

  “现在钢铁、煤炭企业的债券依旧很难卖,因为大多数投资机构对过剩产能行业都很谨慎。比如,同样是AAA/AAA评级(主体评级/债项评级),目前发行利率普遍在3%-3.5%,但煤炭企业的会达到接近6%,高出近250bp-300bp。”北京某券商信用债销售人士告诉本报记者。

China Bad-Loan Managers Face Risks Amid Slowdown, Huarong Says – Bloomberg Business

 More capital at bad-loan managers is being tied up for longer periods of time in soured debt as pricing conditions worsen amid the rising supply of such assets, Huarong Chairman Lai Xiaomin wrote in a six-point proposal to the National People’s Congress. The firms need access to more and cheaper funding channels, said Lai, whose firm is China’s largest bad-loan manager. Data from the banking regulator show that Chinese commercial banks’ nonperforming loans had risen to 1.27 trillion yuan ($195 billion) by December, the highest level since June 2006, as economic growth slowed to the weakest pace in a quarter century. Including “special-mention” loans, where future repayment is at risk but yet to become nonperforming, troubled loans had swelled to 4.2 trillion yuan, or about 5.5 percent of total advances, the data show.

China saw a dramatic increase in wage arrears protests in run up to New Year | China Labour Bulletin

 Between 1 December and 8 February, CLB’s Strike Map recorded 1,050 strikes and collective protests by workers, about 90 percent of which were related to the non-payment of wages. The highest concentration of unrest was in Guangdong, Henan, Shandong and Hebei, with multiple protests by construction workers occurring in several major cities such as Zhengzhou (23 incidents) and Chengdu (21 incidents). Beijing, Guangzhou and Chongqing all had 14 construction worker protests in this period.

Inside China’s Historic $338 Billion Tech Startup Experiment – Bloomberg Business

 The country’s government-backed venture funds raised about 1.5 trillion yuan ($231 billion) in 2015, tripling the amount under management in a single year to 2.2 trillion yuan, according to data compiled by the consultancy Zero2IPO Group. That’s the biggest pot of money for startups in the world and almost five times the sum raised by other venture firms last year globally, according to London-based consultancy Preqin Ltd.

China’s transparency challenges | Brookings Institution

 Are China’s growth numbers wrong? There is a lively debate in the academic literature about the quality of key Chinese data. A case can be made that China’s National Bureau of Statistics (NBS) deserves more credit than it is commonly given. For example, while there is evidence that some official statistics are “too smooth,” this smoothness is unusual in that it includes a long period of overstated inflation and understated growth, which smacks of technical error more than political tampering. One study found that the official growth numbers were “significantly and positively correlated” with externally verifiable measures of economic activity, including import and export data from China’s trading partners, and another found they were historically only “weakly related,” but that the official numbers have been growing more accurate over time. Many researchers (including those at international agencies like the World Bank) find the official GDP data to be at least “usable and informative” [Feng, Hu, and Moffitt].

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