MNI China Press Digest: Friday, Nov. 24

     BEIJING (MNI) - The following are highlights from the China press for

Friday, Nov. 24:

     Regulators have clamped down on finance technology (fintech) companies,

with payday loans as a focus, Huang Zheng, head of China Finance Technology

Innovation Research Institute, wrote in an article published Friday in the

Financial News, a newspaper of the People's Bank of China. Financial regulators

have extended a risk prevention campaign because of unsolved problems in the

fintech sector. As the media had reported, the Chinese government on Tuesday did

issue a document calling for a halt to the creation of new companies providing

payday loans. The tightening this time could be regarded as increased

coordination between local and central financial regulators, as the National

Financial Work Conference and the 19th Communist Party Congress emphasized,

Huang wrote. Some local governments have issued too many licenses to payday loan

companies, and the central government has ordered them to review the companies

and strengthen supervision. (Financial News)

     The yuan strengthened against the dollar and the yuan central parity rose

269 basis points Thursday, mainly due to the weakening of the dollar, the

Securities Daily reported Friday. The yuan may fluctuate around a rate of 6.60

to the dollar. Analysts said that a drop in the dollar index followed the

release of the minutes of the U.S. central bank's Federal Open Market Committee,

showing that some committee members hesitated about the Fed further increasing

its benchmark interest rates. Also supporting the strengthening of the yuan,

recent fluctuation in the Chinese bond market have caused the yield of 10-year

treasuries to rise to more than 4%. Wang Qing, head of the trade and finance

center at the Suning Financial Research Institute, told the newspaper that there

is a high chance the People's Bank of China will increase liquidity injection

into the market. He added that in the short term, it is unlikely the treasury

yield will continue to be higher than 4%. The spread between Chinese and U.S.

treasury yields is expected to recover under the central bank's injections,

Huang said. (Securities Daily)

     The issuance of corporate bonds decreased by around 60% in valuation in the

first 10 months of this year, although new bond categories experienced high

growth, the Securities Daily reported Friday. Through October, 1,074 corporate

bonds were issued, raising CNY1070.73 billion, down 58.87% from a year ago,

Pengyuan Credit Rating data show. In the same period, 22 green corporate bonds

were issued, with a volume of CNY22.76 billion. The issuance of corporate bonds

of innovative companies rose quickly, totaling 16, worth CNY3.14 billion, the

newspaper said, without giving any base number or growth rate. The rapid growth

in green company and innovative company bonds could be attributed to the Chinese

government's encouraging development of green finance and small companies, and

vowing to expand financing channels for them. Shi Xiaoshan, an analyst at

Pengyuan, said that with risk controls continuing in the bond sector and a lack

of momentum in corporate bonds, yields would continue to diverge. (Securities

Daily)

--MNI Beijing Bureau; +86 (10) 8532-5998; email: iris.ouyang@marketnews.com

--MNI Beijing Bureau; +86 (10) 8532-5998; email: rich.dirks@marketnews.com

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