A year after it shook up China’s stodgy banking sector with the launch of its Yu’ebao savings product, e-commerce leader Alibaba looks set to give the market another shot of needed innovation in a new tie-up with 7 major banks. This time the aim is to promote lending to small and medium-sized enterprises (SMEs), with a focus on manufacturers and especially exporters. Such companies often have difficulty getting loans from traditional banks for reasons I’ll explain shortly. Thus this new partnership aims to use Alibaba’s mountains of financial data on these smaller companies to help the banks better understand underserved SMEs that are a critical player in China’s economy. Read Full Post…
The following press releases and media reports about Chinese companies were carried on July 16. To view a full article or story, click on the link next to the headline.
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Alibaba Said Likely To Sell More IPO Stock As Yahoo (Nasdaq: YHOO) Retreats (English article)
China Construction Bank (HKEx: 939) Registers New Zealand Subsidiary (English article)
China Awards 5th Batch Of E-Payment Licenses, Including First For Foreign Firm (Chinese article)
BYD (HKEx: 1211) Announces First Factory In Brazil (Businesswire)
Ctrip (Nasdaq: CTRP) Criticized For High-Fee Refund Policy (Chinese article)
A trio of cross-border news bits is highlighting the complexities in the China-US trade relationship, where accusations of cybersyping from both sides have raised tensions and threatened to derail business dealings in the sensitive high-tech space. All 3 news bits involve tech giant IBM (NYSE: IBM), which was one of the earliest and most active US tech firms to come to China, and thus stands to lose the most from recent tensions. Two of the headlines look relatively positive, including China’s approval of a multibillion-dollar M&A deal and IBM’s launch of a major new business initiative. The third looks more ominous, and has a top lender preparing to ditch its IBM servers in favor of homegrown products in a shift that looks highly political.
A couple of headlines are underscoring the high risk that China’s financial sector could soon pose for both domestic and international investors, as the nation’s financiers look for the most creative but not necessarily the safest ways to raise money. In the first instance, China Merchants Bank (HKEx: 3968; Shanghai: 600036) has officially joined the nation’s big national banks in a move to Europe, choosing the free-wheeling Luxembourg market as its first destination. Meantime, media are reporting that yet another domestic Chinese financial product is about to default, joining a growing list of such distressed high-yield offerings. Read Full Post…
The Year of the Snake is ending with a bang for outbound Chinese M&A, with word that leading lender ICBC (HKEx: 1398; Shanghai: 601398) is buying a controlling stake of the European trading unit of South Africa’s Standard Bank for $765 million. This year-end mega-deal comes the same day as another blockbuster deal was announced, which had PC giant Lenovo (HKEx: 992) saying it would buy faded cellphone titan Motorola for $2.9 billion. (previous post) But these 2 deals don’t really share very much besides the fact that both are large outbound purchases by Chinese companies, and I have to say the ICBC deal easily looks like my favorite among the pair. Read Full Post…
This week’s China visit by British Prime Minister David Cameron is stirring up a flurry of activity from the big 4 Chinese state-run banks, 3 of which have just announced new tie-ups in Europe. The move by Chinese banks into Europe isn’t all that surprising, since the EU is China’s biggest trading partner and London is one of the world’s top 2 financial centers alongside New York. What is slightly surprising is the suddenness of this flurry of activity, which I suspect is at least partly driven by a directive by Beijing for the nation’s big 4 lenders to go global and internationalize China’s currency, the yuan. Read Full Post…
Note: After first publishing this post, CCB formally announced it will purchase 76 percent of BicBanco for 13.6 billion Brazilian reais ($720 million). To view the announcement, click here.
After living in China for a while, one comes to realize that new trends among big state-owned enterprises often happen quickly and in waves in response to directives from Beijing. That looks like the case among the nation’s big 4 lenders, with word that China Construction Bank (CCB) (HKEx: 939; Shanghai: 601939) is in late stage talks for its first major global acquisition of a bank in Brazil. CCB’s sudden interest in global acquisitions comes just weeks after another domestically-focused big 4 lender, Agricultural Bank of China (AgBank) (HKEx: 1288; Shanghai: 601288) was also reportedly in talks to buy Hong Kong’s Wing Hang Bank (HKEx: 302) Read Full Post…
The following press releases and media reports about Chinese companies were carried on November 2-4. To view a full article or story, click on the link next to the headline.
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Qunar (Nasdaq: QUNR) Doubles In Debut As Chinese Stocks Make US Comeback (English article)
Lenovo (HKEx: 992) To Enter US Handset Market (English article)
China Construction Bank (HKEx: 939) Buys 76 Pct Of BicBanko For $720 Mln (HKEx announcement)
PPTV Won’t Enter Smart TV After Suning (Shenzhen: 002024) Investment – CEO (Chinese article)
Canadian Solar (Nasdaq: CSIQ) In 100MW Supply Deal With 3 Gorges New Energy (PRNewswire)
The following press releases and media reports about Chinese companies were carried on October 31. To view a full article or story, click on the link next to the headline.
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China Construction Bank (HKEx: 939) In Talks To Buy Brazil’s BicBanco: Source (English article)
Agricultural Bank of China (HKEx: 1288; Shanghai: 600188), the last of China’s “big 4” banks to go public, is now becoming the last of the quartet to eye a global expansion, with word that it’s weighing a bid for Hong Kong’s Wing Hang Bank (HKEx: 0302). I’m generally not a huge fan of AgBank, mostly because its history as a lender to farmers and other agricultural enterprises makes it the least market-oriented of China’s biggest 4 national lenders. But that said, this baby step onto the global stage looks like a relatively well conceived plan for perhaps some bigger steps in the next few years. Read Full Post…
Banking services have suddenly become the flavor of the day for China’s Internet firms, with e-commerce leader Alibaba forming a new tie-up with a major bank, as Suning (Shenzhen: 002024) moves closer to its aim of getting a formal banking license. This relatively sudden move by Internet firms into financial services comes as a slight surprise, since I haven’t really seen anything similar in the west. But that said, the financial services sector in most western markets is already well served by mature, market-oriented firms — a sharp contrast to China where the sector is dominated by less efficient state-run companies. Read Full Post…
