Hong Kong penalizes 4 banks; CBA invests in crypto exchange Gemini

TOP NEWS IN BANKING & FINANCIAL SERVICES

* Hong Kong's central bank has imposed penalties totaling HK$44.2 million on China Construction Bank (Asia) Corp. Ltd., CTBC Bank Co. Ltd. (Hong Kong Branch), Industrial and Commercial Bank of China (Asia) Ltd. and UBS AG, Hong Kong Branch over breaches of the anti-money laundering and counterterrorist financing regulations.

* Commonwealth Bank of Australia, or CBA, confirmed a minority investment in Gemini, one of the world's largest regulated cryptocurrency exchanges and custodians. The Australian lender took part in Gemini's first-ever equity raise and said it will leverage the company's platform as it prepares to offer services for crypto-assets.

➤ Quotes of the quarter: APAC lenders bank on digitalization for post-COVID growth

During conference calls regarding the banks' results for the quarter ended Sept. 30, top executives spoke of their plans and outlook for the remainder of 2021 and beyond.

➤ Data Dispatch: US bank margins finally rebound in Q3

U.S. bank margins rebounded modestly in the third quarter after plunging over the last few quarters, but the key profitability metric remained well below pre-pandemic levels.

BANKING

* South Korea's Korea Development Bank secured a restricted banking license in Hong Kong, lifting the number of banks with restricted licenses in the region to 16, according to the Hong Kong Monetary Authority. The license took effect Nov. 19.

* Industrial & Commercial Bank of China Ltd.'s joint proposal with China Galaxy Securities Co. Ltd. for an innovation that will apply digital currency in securities trading was included in the first batch of 16 designated pilot financial technology projects, Caixin reported, citing a statement from the China Securities Regulatory Commission's Beijing Bureau and the Beijing Local Financial Supervision and Administration. The regulators are seeking public comment on the projects.

* MUFG Bank Ltd. named Marius Weehuizen head of institutional investors coverage, financial institutions, for Asia, Asian Banking and Finance reported, citing a press release.

* Cybersecurity firm CyberX9 claims that critical financial and personal information of 180 million Punjab National Bank customers were at risk for approximately seven months due to vulnerability in the lender's servers, Mint reported. The India-based lender confirmed a glitch in its servers but assured that no customer data or applications have been affected.

* State Bank of India has yet to refund 1.64 billion rupees of undue fees it charged for digital payments of Pradhan Mantri Jan Dhan Yojana account holders between April 2017 and December 2019, the Press Trust of India reported, citing an Indian Institute of Technology Bombay report.

FINANCIAL SERVICES

* The Shanghai Stock Exchange is introducing new regulations on the delisting process as part of a crackdown on shell companies.

* Mizuho Leasing Co. Ltd. plans to issue ¥10 billion of five-year green bonds in December. The proceeds will be used to fund the company's acquisition of a hydroelectric power plant in Japan.

POLICY AND REGULATION

* The People's Bank of China said it would maintain a prudent, flexible and targeted monetary policy and strike a balance between economic growth and risk management, Reuters reported. In its third-quarter monetary policy report, the central bank also said risks associated with China's property market are under control.

* A central bank-led self-regulatory group helping to oversee China's foreign exchange industry has asked commercial banks to limit the size of their proprietary trading accounts, Reuters reported, citing five sources with direct knowledge of the matter. Analysts believed the measures are meant to halt yuan gains.

* Taiwan's Financial Supervisory Commission ordered an internal investigation into Shin Kong Financial Holding Co. Ltd.'s former chairman, Eugene Wu, over violations on a ban on Wu's involvement in the firm's management, Taipei Times reported, citing the commission's chairman, Thomas Huang.

* Lee Chan-woo, first senior deputy governor of South Korea's Financial Supervisory Service, urged major banks in the country to adopt "best practice" in determining lending rates amid growing concerns that recent hikes in loan rates could worsen the financial burden on households, The Korea Herald reported.

* The Philippines' Securities and Exchange Commission released draft guidelines for financial and lending companies that use or plan to use financial technology in the delivery of their loan products and services through online lending platforms. The proposed regulation is open for public comment until Dec. 3.

* Bangko Sentral ng Pilipinas Gov. Benjamin Diokno told an online briefing that operators of local payment systems will be subjected to more stringent requirements in recognition of their potential to pose systemic risks to the country's financial system, The Philippine Daily Inquirer reported.

* A Reserve Bank of India working group warned of the regulatory implications of Big Tech players' entry into the digital space, particularly concerns relating to concentration and competition risks, Business Standard reported, citing the group's report. The group advised the central bank to develop a framework for identifying and managing risks and to decentralize finance through blockchain technology.

* Pakistan's Federal Investigation Agency, the State Bank of Pakistan and the country's banks agreed to strengthen collaboration against money laundering, digital frauds and cyberattacks, Dawn reported. The move comes as the country seeks removal from the Financial Action Task Force's grey list of countries with inadequate controls to prevent terrorism financing.

* The State Bank of Pakistan lifted its benchmark interest rate by 150 points to 8.75% to reverse inflationary pressures and preserve stability with growth, Dawn reported, citing the central bank.

INDUSTRY NEWS

* The Islamic Finance Development Indicator 2021 report places Malaysia and Indonesia as the top two countries leading the expansion of the Islamic fintech industry and digital banks, Bisnis Indonesia reported.

Click here for a summary of indexes on the S&P Capital IQ Pro platform.

Eden Estopace, Kanas Chan, Jonathan Cheah, James Lim and Santibhap Ussavasodhi contributed to this report.

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