China market round-up: ICBC given new chairman, first quarter GDP indicates recovery, seven funds ready for Shanghai tech board
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China market round-up: ICBC given new chairman, first quarter GDP indicates recovery, seven funds ready for Shanghai tech board

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In this round-up, former Bank of China chairman Chen Siqing has been moved to be chairman of Industrial and Commercial Bank of China, China’s gross domestic product (GDP) grew 6.4% and the first batch of funds keen to invest in Shanghai tech board listing have received approval to do so

ICBC got a new chairman on Monday evening when Chen Siqing, the former chairman of Bank of China (BOC), was given the job. Chen had worked for BOC since 1990. 

He fills the vacancy created when former chairman, Yi Huiman, was made head of the China Securities Regulatory Commission in January.

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China’s GDP rose 6.4% in the first quarter of 2018, according to data from the National Bureau of Statistics on April 17. Analysts interpreted the data as a sign of economic recovery. 

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Chinese regulators approved the first batch of funds looking to invest on the new Shanghai tech board on Monday, Caixin reported. The seven funds are E Fund, China Universal, Harvest Fund, China AMC, Fullgoal Fund, ICBC Credit Suisse Asset Management, and China Southern Asset Management.

They will not be limited to investing in stocks listed on  the new tech board, however. Their investment scope includes all tech stocks on the main board, the ChiNext board, and the small and medium enterprises board on the Shenzhen Stock Exchange. 

The funds are required to have “science and technology innovation” in their names and must have at least 80% of their assets under management invested in tech stocks. 

So far, a total of 92 companies have applied to list on the tech board and 78 are currently responding or have responded to queries from the Shanghai Stock Exchange (SSE).  

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SIX Swiss Exchange signed a memorandum of understanding with the SSE on Tuesday. 

The two exchanges will explore opportunities to list central depository receipts on each other’s boards. 

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Foreign direct investment (FDI) into the mainland expanded 8% year-on-year (YoY) to Rmb95.2bn ($14.1bn) in March, the Ministry of Commerce said on April 18. 

In the first three months of 2019, FDI inflows rose 6.5% YoY to Rmb242.3bn. In dollar terms, FDI inflow rose 3.7% YoY to $35.8bn. 

FDI from Korea, Japan, the United States, Germany, and the UK increased 79.6%, 6.4%, 71.3%, 86.1%, and 12.4% respectively. 

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Dagong Global Credit Rating, one of the biggest ratings agencies in China, has been taken over by China Reform Holdings, a state-owned investment company, state media Xinhua reported on Friday. 

The move came after Chinese regulators suspended Dagong’s rating license in August due to conflicts of interest and sluggish corporate governance. After the takeover, China Reform Holdings will hold 58% of Dagong. 

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The renminbi retained its position as the fifth most active currency for domestic and international payments by value, with a share of 1.89%, according to Swift, a cross-border payment services provider, which published its monthly RMB tracker report on Wednesday. The share was slightly up from February’s 1.85% figure. 

Hong Kong, the largest offshore renminbi clearing centre, accounted for 74.61% of all renminbi payments outside China, a dip from February’s 75.96% share. The UK retained first place as the venue for FX transactions by value, hosting 36.14% of all activity. 

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The Philippines’ planned Panda bond, originally scheduled for after Easter week, has been delayed until May, local media reported, citing Rosalia De Leon, the country’s treasurer. 

Huawei Technologies reported 39% YoY revenue growth in all business segments in the first quarter of 2019, it said on Monday. 

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BOC signed an agreement with MUFG Bank on April 1 to become the custodian bank of the latter’s RMB Qualified Foreign Institutional Investor (RQFII) programme. 

So far, MUFG has not been granted an RQFII quota, according to the latest data from the State Administration of Foreign Exchange. Japan as a country has a quota of Rmb200bn. 

BOC also opened its renminbi clearing branch in Japan on the same day. The branch will be in Tokyo.  

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