MNI China Press Digest Feb 9: IPO, Housing, Capital Flow

The following lists highlights from Chinese press reports on Wednesday:

• China’s domestic security firms raised CNY113 billion in initial public offerings from the start of this year through Feb. 8, 229% more than the same period a year ago, the China Securities Journal said. The increase in capital raised contrasts with a smaller number of IPO applications approved, which numbered 33 out of 36 submitted, compared with 76 out of 83 last year, indicating tighter regulatory scrutiny, the newspaper said. Citic Securities led with CNY34.9 billion underwritten, followed by CICC’s CNY27.6 billion, the journal said. China is expected to fully implement the so-called stock registration system reform on its mainboards this year, the journal said. The new system, more in line with other mature capital markets, will allow more companies to meet the listing criteria and boost the overall IPO market.
• China’s banking regulators on Tuesday further eased restrictions on rental housing development, a move set to spur more developers applying for loans, the China Securities Journal reported. In a directive published yesterday, the PBOC and the banking commission excluded guaranteed rental property projects from its centralized management system, essentially encouraging banks to freely lend to developers of these projects without quota restrictions. At the end of November, loans to rental housing development rose five times faster than the average rate of growth of all lending, the newspaper said.
• China won’t see a capital outflow even as the U.S. Federal Reserve is more likely to raise interest rate starting in March, the Economic Information Daily said citing analyst Liang Si with Bank of China. The yuan has stayed strong and the higher interest rate offered by China and lower inflation will prevent an exodus of foreign capital, Liang was cited saying. Yuan assets are still attractive as they are more independent from other global markets, offering investors an option to diversify risks, the newspaper said. China’s higher economic growth and supply chain advantage as well as the financial market opening will help keep capital movement stable, the daily said citing spokeswoman Wang Chunying of the State Administration of Foreign Exchange.