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China joins JPMorgan indexes; Australia IPOs; Moody's Indian bank rating actions

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China joins JPMorgan indexes; Australia IPOs; Moody's Indian bank rating actions

GREATER CHINA

* China could introduce further reductions in banks' reserve requirement ratios as it seeks to ramp up economic support by freeing up funds for lending, Reuters reported, citing a statement on the Chinese State Council's website. The People's Bank of China has cut the ratio six times since early 2018, with the latest cut rolled out in January this year.

* JPMorgan Chase & Co. is including China's benchmark bond indexes in its benchmark emerging-market indexes, beginning Feb. 28, 2020, Bloomberg News reported, citing the bank. The move is expected to increase inflows into China's bond market by US$3 billion a month.

* Online peer-to-peer lending institutions will be included in China's credit reference system, Xinhua News Agency reported. Online lending will be factored into the credit system, which could lead to borrowers with low credit scores facing higher interest rates or restrictions on borrowing.

JAPAN AND KOREA

* Mitsubishi UFJ NICOS Co.Ltd. is looking to collaborate with Bangkok-based Bank of Ayudhya PCL to roll out Thailand's PromptPay payment platform in Japan and urge local merchants to process transactions using the QR code-based payment service, Tokyo's The Nikkei reported.

* South Korea's KB Securities Co. Ltd. is seeking to recover its investment in JB Australia NDIS Fund, which was set up by JB Asset Management Co. Ltd. to invest in the Australian government's National Disability Insurance Scheme projects, citing contract violations by an Australian company, The Chosun Ilbo reported.

* Samsung Securities Co. Ltd. signed a memorandum of understanding with Canada's Caisse de dépôt et placement du Québec to collaborate on global infrastructure investments, The Chosun Ilbo reported, citing the South Korean company.

* The Korea Federation of Banks signed a memorandum of understanding with the Myanmar Banks Association to operate a financial information-exchange program between member banks in South Korea and Myanmar, FNTimes reported.

ASEAN

* Manila-based Rizal Commercial Banking Corp. will issue U.S. dollar-denominated five-year sustainability notes, with initial price guidance of 195 basis points above the five-year U.S. Treasury. The notes will be issued Sept. 11 and will be listed on the Singapore stock exchange.

* A survey by the Monetary Authority of Singapore showed most economist respondents predicting a drop in the city-state's GDP growth to 0.6%, down from 2.1% in a previous survey, The Edge Singapore reported. In the second quarter, Singapore's economy grew 0.1% year over year, lower than respondents' projections of 1.6% in a prior survey.

* RAM Ratings said the asset quality of Malaysia's banking system remained strong despite higher gross impaired loan ratio at the end of July. Analyst Wong Yin Ching noted that banks kept healthy loss-absorption buffers with an average coverage ratio for impaired loans at 131%.

* Slowing credit growth in Indonesia's banking sector has impacted the performance of banks in neighboring ASEAN countries, which could lead to an increase in the lenders' noninterest and fee-based income to sustain revenues, Bisnis Indonesia reported, citing Lando Simatupang, head of research at the Indonesian Banking Development Institute.

SOUTH ASIA

* Moody's raised its outlook on Punjab National Bank to positive from stable, citing improved capital adequacy ratios and baseline credit assessments once it completes its merger with Oriental Bank of Commerce and United Bank of India, and receives a capital infusion from the government. Moody's affirmed the ratings of Punjab National Bank and Oriental Bank of Commerce. It also affirmed the ratings of Canara Bank, Syndicate Bank Ltd., Union Bank of India, all of which are participants in four sets of bank mergers in India.

* India's IDBI Bank Ltd. has initiated a review process for its stake in joint venture IDBI Federal Life Insurance Company Ltd., which may result in a potential sale of all or part of its shares in the insurance company, Mint reported, citing the bank. JPMorgan India was hired to advise and manage the strategic review process.

* Yes Bank Ltd. settled a case with the Securities and Exchange Board of India in relation to a disclosure by the bank in February, which led to its shares rising 30%, Business Standard reported. The securities board accused the bank of highlighting "NIL" divergence in a risk assessment report by the central bank and excluding findings of regulatory breaches and lapses. Yes Bank paid 5.16 million rupees in settlement charges.

* The Reserve Bank of India is requiring all banks to use an external benchmark-based lending rate system in determining interest rates for floating rate loans. The mandate will take effect Oct. 1.

AUSTRALIA AND NEW ZEALAND

* Australia's Latitude Financial Services Ltd may revive its IPO plan this year, with a potential float slated for late October or early November, The Australian reported. Goldman Sachs, Macquarie Capital and UBS are said to be working on the revised IPO plan after it was postponed in 2018.

* Tyro Payments Ltd's IPO is expected to be priced at about 10× its earnings when it lists by December, The Australian reported. The Sydney-based payments processor is expected to be valued at about A$2 billion, but its IPO would likely be worth A$250 million, according to the report, without citing a source.

* Moelis Australia Ltd. is conducting a pre-IPO raising for a fund run by Moelis Australia Asset Management Ltd., The Australian Financial Review reported. The Moelis Australia Fixed Income Fund, which holds about A$70 million in invested assets, is expected to list in the first half of 2020.

* AIA New Zealand Ltd. hired Tracey Cross as an independent director on its board, Insurance Business NZ reported. Cross is a partner at multinational law firm DLA Piper, the report said.

IN OTHER PARTS OF THE WORLD

Middle East & Africa: France considers $15B credit line for Iran; South Africa averts recession in Q2

Europe: UK lawmakers poised to stop no-deal Brexit; RBS' PPI woes; KBC to cut 1,400 jobs

Latin America: Chile cuts key rate by 50 basis points; Swiss Re sells Sul América stake

North America: Colo CU to acquire bank; Cboe Europe pursues Dutch hub regardless of Brexit

Global Insurance: Reinsurance sector forecasts; Scor strategic plan; NatGen Swedish sale

R Sio, Emily Lai, Jonathan Cheah, Jaekwon Lim and Santibhap Ussavasodhi contributed to this report.

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