MNI China Press Digest, Nov 7: Yuan, Small Bank, Euro Bond

     BEIJING (MNI) - The following lists highlights from Chinese press reports

on Thursday:

     Chinese regulators should continue to relax restrictions and promote the

internationalization of the yuan, said Huo Yingli, director of macro-prudential

management bureau at the PBOC. As reported in the China Business News, Huo said

the PBOC has shortened the time needed for foreign investors to enter the

Chinese market, has improved policy transparency, clarified tax payment

arrangements and introduced overseas rating agencies. The further opening of

financial markets would further promote the cross-border use of the yuan, Huo

said.

     China's yuan internationalization has created a good foundation and will

play an important role in the development of Free Trade Zones, China Securities

Journal reported. Citing Chen Yulu, vice governor of the PBOC, the Journal's

report said the internationalization of the yuan would serve the real economy

and facilitate trade and investment. The currency was increasingly an

independent choice for market participants, Chen said.

     China should further reform the small and medium-sized banking sector to

enhance its contribution to the real economy, Securities Times has reported,

citing official sources. The Times reported on the meeting held by the Financial

Stability and Development Committee of the State Council held on Wednesday,

which discussed measures such as supporting small banks to replenish capital,

optimise their capital structure and improve their risk management. The meeting

also discussed improving the banking business model for the sector.

     The success of China's first euro bond in 15 years highlights the world's

confidence in China's economic prospects, Xinhua News Agency said in a

commentary. Chinese financial products have become a safe-haven for

international investors, and they regard China as one of the most worthwhile

investment markets amid the global economic slowdown, Xinhua said.

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

--MNI Sydney Bureau; +61 405322399; email: lachlan.colquhoun.ext@marketnews.com

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