The initial public offerings of Agricultural Bank of China and Industrial & Commercial Bank of China in recent years provide insights into how the hiring of key Chinese "princelings" smoothed the way for such deals. These hirings are now the subject of a U.S. Justice Department inquiry that focuses on JPMorgan.
Bank of America is unloading the last of its stake in China Construction Bank, joining a list of other Western banks disappointed with their forays into the market. The U.S. bank initially took a 9.9% stake in CCB in 2005 for US$3 billion.
Shares of financial companies in Taiwan are getting a lift from news that regulators are weighing more market-opening policies to shore up the nation's banking system. Among the measures under consideration is wider scope for domestic banks for market expansion in China, allowing Taiwan banks to use as much as 40% of net worth for the purpose, up from the current 15% limit.
HSBC's China purchasing managers index climbed to 50.1 in August, confirming a preliminary reading and supporting the official PMI of 51.0. The latest HSBC figure is up from 47.7 in July. "This was mainly driven by the initial filtering-through of recent stimulus measures and companies' restocking activities. We expect some upside surprises to China's growth in the coming months," said Hongbin Qu, HSBC's chief economist for China.
Output in China's non-manufacturing sector picked up in July, with the purchasing managers' index rising to 54.1 from 53.9 the month before. "Although challenges remain, China's economy has the foundations for steady growth" in the second half, said Cai Jin, vice chairman of the China Federation of Logistics and Purchasing.