China is inspecting financial regulators, state banks
MAINLAND CHINA & HONG KONG
China is inspecting the nation’s financial regulators, biggest state-run banks, insurers, and bad-debt managers for the first time in six years to root out corruption in its USD54t financial system.
A team led by the Central Commission for Discipline Inspection will start a two-month anti-graft check of the China Banking and Insurance Regulatory Commission (CBIRC), and accept complaint reports from whistle blowers until 15 December, according to a statement late Monday (11 October).
CBIRC Chairman Guo Shuqing said the move is a reflection of the Communist Party’s focus on financial regulation and told his staff that cooperation with inspectors will be their top priority for now.
The banking regulator is among the 25 financial organisations being scrutinised in the eighth round of checks by the ruling Communist Party since 2017. While previous tours covered other central and local government agencies and state-owned companies, the latest zeros in on entities including the People’s Bank of China (PBOC), the China Securities Regulatory Commission, the Shanghai and Shenzhen stock exchanges, the biggest state-owned banks, as well as bad-debt managers including China Huarong Asset Management.
The PBOC, the State Administration of Foreign Exchange, sovereign wealth fund China Investment Corporation, and Huarong issued similar statements Tuesday announcing the start of their inspections. The inspection team heads stressed the need to prevent “systematic financial risks,” while the top officials of the inspected agencies vowed full cooperation.
It also comes as authorities are cracking down on everything from fintech platforms to property developers to limit financial risks. Global investors have been unnerved by the regulatory onslaught from Beijing targeting its biggest technology companies and other industries as well as a push by President Xi Jinping to create “common prosperity”, a campaign to narrow the wealth divide. – Bloomberg News.
On Tuesday, the Shanghai Composite Index closed 1.25% lower at 3,546.94. The Hang Seng Index slipped 1.43% to 24,962.59.
REST OF ASIA
Samsung Electronics’s (005930 KS) price target was cut by several analysts this week (ending 15 October), as China’s power crisis is seen worsening supply chain disruptions and weighing on the company’s profits. Shares slumped to their lowest since December.
The persistent supply chain bottlenecks, which stemmed from the spread of the coronavirus in Southeast Asia and now from China’s limited electricity supply, will likely undermine the memory chip industry during the fourth quarter, wrote an analyst in a report Tuesday (12 October).
Still, Samsung’s consensus 12-month price target of KRW98,944 based on contributions from 36 analysts implies a potential return about 43% from current levels, data compiled by Bloomberg show. – Bloomberg News.
South Korea’s Kospi Index added 0.73% to 2,937.73 Wednesday morning, reversing its previous loss of 1.35% to 2,916.38.
Australia’s S&P/ASX 200 Index opened 0.10% higher at 7,288.00 on Wednesday after losing 0.26% to 7,280.70 on Tuesday.
The Taiwan Stock Exchange Weighted Index lost 1.07% to 16,462.84.
The information published by DBS Bank Ltd. (company registration no.: 196800306E) (“DBS”) is for information only. It is based on information or opinions obtained from sources believed to be reliable (but which have not been independently verified by DBS, its related companies and affiliates (“DBS Group”)) and to the maximum extent permitted by law, DBS Group does not make any representation or warranty (express or implied) as to its accuracy, completeness, timeliness or correctness for any particular purpose. Opinions and estimates are subject to change without notice. The publication and distribution of the information does not constitute nor does it imply any form of endorsement by DBS Group of any person, entity, services or products described or appearing in the information. Any past performance, projection, forecast or simulation of results is not necessarily indicative of the future or likely performance of any investment or securities. Foreign exchange transactions involve risks. You should note that fluctuations in foreign exchange rates may result in losses. You may wish to seek your own independent financial, tax, or legal advice or make such independent investigations as you consider necessary or appropriate.
The information published is not and does not constitute or form part of any offer, recommendation, invitation or solicitation to subscribe to or to enter into any transaction; nor is it calculated to invite, nor does it permit the making of offers to the public to subscribe to or enter into any transaction in any jurisdiction or country in which such offer, recommendation, invitation or solicitation is not authorised or to any person to whom it is unlawful to make such offer, recommendation, invitation or solicitation or where such offer, recommendation, invitation or solicitation would be contrary to law or regulation or which would subject DBS Group to any registration requirement within such jurisdiction or country, and should not be viewed as such. Without prejudice to the generality of the foregoing, the information, services or products described or appearing in the information are not specifically intended for or specifically targeted at the public in any specific jurisdiction.
The information is the property of DBS and is protected by applicable intellectual property laws. No reproduction, transmission, sale, distribution, publication, broadcast, circulation, modification, dissemination, or commercial exploitation such information in any manner (including electronic, print or other media now known or hereafter developed) is permitted.
DBS Group and its respective directors, officers and/or employees may have positions or other interests in, and may effect transactions in securities mentioned and may also perform or seek to perform broking, investment banking and other banking or financial services to any persons or entities mentioned.
To the maximum extent permitted by law, DBS Group accepts no liability for any losses or damages (including direct, special, indirect, consequential, incidental or loss of profits) of any kind arising from or in connection with any reliance and/or use of the information (including any error, omission or misstatement, negligent or otherwise) or further communication, even if DBS Group has been advised of the possibility thereof.
The information is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation. The information is distributed (a) in Singapore, by DBS Bank Ltd.; (b) in China, by DBS Bank (China) Ltd; (c) in Hong Kong, by DBS Bank (Hong Kong) Limited; (d) in Taiwan, by DBS Bank (Taiwan) Ltd; (e) in Indonesia, by PT DBS Indonesia; and (f) in India, by DBS Bank Ltd, Mumbai Branch.