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MNI China Press Digest Aug 15: Lower LPR, Delisting

MNI summarises the key stories from the Chinese press on Monday.

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The following lists highlights from Chinese press reports on Monday:

  • China’s benchmark Loan Prime Rates may decline further, with a particular focus on the five-year measure, the China Securities Journal reported, citing analysts. Among the newly issued loans in June, the proportion of loans with interest rates lower than the LPRs has increased, which may drive down the latest quotation of the LPRs, the newspaper wrote, citing Xie Yunliang, chief macro analyst of Cinda Securities. The weighted average interest rate of newly issued loans in June hit a new low, the newspaper noted, citing the PBOC’s Q2 Monetary Policy Report. The central bank updates LPR quotations on the 20th of every month (or the soonest day afterwards if the 20th falls on a weekend), and the current 1-year and 5-year LPR fixings sit at 3.70% and 4.45%, respectively.
  • The delisting of five Chinese state-owned companies, including PetroChina, Sinopec and China Life Insurance, from the New York Stock Exchange will not have a great impact on Chinese stocks and the capital markets of China and the U.S., nor does it point to a want for financial “decoupling”, Economic Daily reported, citing analysts. These companies chose to delist because of high costs and regulatory issues, and most of their shares are listed on the exchanges in mainland China and Hong Kong, with less than 1% of total shares listed on NYSE, the newspaper said. This should not trigger a wave of similar delistings, and Chinese regulatory authorities will firmly support companies to list where they wish, the Daily said.
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The following lists highlights from Chinese press reports on Monday:

  • China’s benchmark Loan Prime Rates may decline further, with a particular focus on the five-year measure, the China Securities Journal reported, citing analysts. Among the newly issued loans in June, the proportion of loans with interest rates lower than the LPRs has increased, which may drive down the latest quotation of the LPRs, the newspaper wrote, citing Xie Yunliang, chief macro analyst of Cinda Securities. The weighted average interest rate of newly issued loans in June hit a new low, the newspaper noted, citing the PBOC’s Q2 Monetary Policy Report. The central bank updates LPR quotations on the 20th of every month (or the soonest day afterwards if the 20th falls on a weekend), and the current 1-year and 5-year LPR fixings sit at 3.70% and 4.45%, respectively.
  • The delisting of five Chinese state-owned companies, including PetroChina, Sinopec and China Life Insurance, from the New York Stock Exchange will not have a great impact on Chinese stocks and the capital markets of China and the U.S., nor does it point to a want for financial “decoupling”, Economic Daily reported, citing analysts. These companies chose to delist because of high costs and regulatory issues, and most of their shares are listed on the exchanges in mainland China and Hong Kong, with less than 1% of total shares listed on NYSE, the newspaper said. This should not trigger a wave of similar delistings, and Chinese regulatory authorities will firmly support companies to list where they wish, the Daily said.