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Weekly news through July 8


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Weekly news through July 8

This weekly article offers aselection of our top banking stories published throughout the week.

On the regulatory and legalphase

Anumber of legal action and regulatory developments involving banks in theAsia-Pacific region, particularly by those in China, Japan and South Korea,dominated headlines this week.

Chinais looking to requireforeign banks to set aside reserves for their foreign-exchange forward trading,according to the China Foreign Exchange Trade System. Under the new rule,foreign banks will be required to set aside reserves equal to 20% of theforward-trade position, effective Aug. 15.

Meanwhile,China's National Audit Office said Chinese state-run banks, includingAgricultural Bank of ChinaLtd. and ChinaEverbright Bank Co. Ltd., were found to have issued loans to unqualified borrowers.

InJapan, the country's five largest banks may begin to voluntarily how much commission theyreceive from insurance companies to improve transparency as early as 2017.

LeeKyung-hee, a spokeswoman from the Korea Federation of Banks, said South Korea'scommercial banks mayadopt a performance-based wage system for employees.

TheReserve Bank ofAustralia decided to keep the cash rate at 1.75% amid continued low inflationand market uncertainty over the U.K.'s decision to leave the European Union.

TheAustralian Securities and Investments Commission the conditions it had imposed onMacquarie Group Ltd.unit Macquarie BankLtd.'s financial services license after the bank complied withclient money regulations.

Elsewhere,the Bank of Thailandrelaxed rules oninvestments in overseas securities as it seeks to weaken the baht to aidexports, effective July 20.

Tie-ups, other transactions

's threebanking units have forged a business partnership with Singapore'sUnited Overseas BankLtd. while subsidiaries of China Everbright Bank into asset management agreementswith China Minsheng Banking Corp.Ltd.

and Bank of YokohamaLtd. agreed toadd two new partners — Bank of Kyoto Ltd. and Gunma Bank Ltd. — into their asset management jointventure.

PapuaNew Guinea's Bank of SouthPacific Ltd. completed its acquisition of Westpac Banking Corp.'s banking operations in Vanuatu.

and China Investment Securities Co. are in discussions on a potentialmerger.

HwangLip Teik, chairman of HwangCapital (Malaysia) Bhd., together with Hwang Enterprises Sdn. Bhd.,now hold more than50% of the voting shares of the company following their offer to acquire allcompany shares that they do not own.

completed its mergerwith IMB Ltd. andChina Bank Capital Corp., a unit of the Philippines' , brokerage ATCSecurities Inc. in line with the parent's plan to have its own brokerage unit.ATC Securities will be renamed China Bank Securities Corp.

Lastly,Citigroup Inc. isreportedlyconsolidating its consumer banking unit in Europe, Middle East and Africa withits Asian unit and Credit SuisseGroup AG decided tomerge its Asia-Pacific fixed income and equities businesses.

In other news

*A group of 11 centralbanks in Asia Pacific isclosing its U.S. dollar-denominated bond fund.

*Japan's three megabanksplan to beginoffering 24-hour money transfer services.

*'sMizuho Bank Ltd.will join China'scross-border interbank payment system as early as the end of July. MizuhoFinancial is also adding more bankers covering small- and medium-sizedenterprises as part of efforts to increase its fee income.

*S&P Global RatingsServices lowered itsoutlook on Australia's four major banks and their strategically importantsubsidiaries to negative after also lowering the outlook on the country'ssovereign ratings to negative.

*raised about A$1.5billion from its issuance of capital notes. The bank issued 14,988,630 capitalnotes at A$100 each.

* US$3.03 billion of green bonds,the largest issue of its kind. The bank issued the bonds in three tranches inthree different currencies — a US$2.25 billion tranche, a €500 million trancheand a 1.5 billion yuan tranche in New York.

*Chile's bankingregulator SBIF is now considering an application by Bank of China to open abranch in the country, the regulator said.

* approval from India's CabinetCommittee on Economic Affairs to raise its foreign shareholding to 74% from thecurrent 62%.

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