RMB round-up: MRF sales near Rmb1tr, NB boosts A-shares capabilities, Sberbank joins SGE
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RMB round-up: MRF sales near Rmb1tr, NB boosts A-shares capabilities, Sberbank joins SGE

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In this round-up, net sales under the mutual recognition of funds (MRF) are approaching a combined volume of Rmb1tr, Neuberger Berman (NB) adds China equity capabilities, and Russian lender Sberbank joins the international board of the Shanghai Gold Exchange.

Our coverage this week:

  • It has been an incredibly busy week for foreign issuers tapping the onshore RMB bond market, with Maybank, the Province of British Columbia, Hungary and red-chip real estate firms Longfor and CR Land all in the pipeline to price Panda deals.

  • The surge in deal-making bodes well for the Panda bond market after a volatile first half.

  • Comment: The People’s Bank of China received a boost to its role last weekend, a key outcome of the financial works conference held in Beijing. The move hints at an upcoming super-regulator, but will that be a good thing?

  • The second GlobalRMB Quarterly for 2017 is now out. The redesigned compendium covers the hottest RMB internationalisation topics from the second quarter of 2017 including Bond Connect and MSCI's decision to include A-share in its indices. Check out the special report here.

Investment:

  • The MRF scheme had a solid month of trading on both channels, according to data from State Administration of Foreign Exchange (Safe). Cumulative net sales of Mainland funds in Hong Kong reached Rmb17.2bn ($2.55bn) by the end of June, up 11.5%. Hong Kong fund sales in China, meanwhile, jumped to Rmb943.2bn, a month-on-month increase of 11.1%.

  • Investment manager NB hired Bin Yu as a portfolio manager to boost its China equity capabilities, the firm said in a July 19 statement. Yu is joined by four research analysts from his previous firm, CloudRidge Capital. The team will cover A-shares and H-shares, and be based across Hong Kong and Beijing.

  • BlackRock is preparing to launch its first private fund in the Mainland market, according to media reports this week. The asset manager received its wholly foreign owned enterprise (WFOE) licence in 2015. After receiving a private fund management licence, asset managers have three months to make their debut in the domestic market, according to current regulations.

Hubs:

  • RMB deposits in South Korea dropped to Rmb8.27bn in June, down 5.98% on a monthly basis and hitting their lowest since February this year. In Taiwan, however, the deposit pool across domestic and offshore banking units inched up 0.35% to Rmb309.15bn.

Regulators:

  • Yao Gang, former vice-chairman of China Securities Regulatory Commission (CSRC), was expelled from the Communist Party of China and dismissed from public office for graft, according to state media reports on July 20.

Commodities:

  • Sberbank said its Switzerland subsidiary had begun trading physical gold on the Shanghai Gold Exchange's international board, according to a July 13 press release. The Russian lender became a member of the exchange in September 2016 and said that it plans to conduct deliveries for up to six tonnes of gold to China by year end.

FX:

  • The PBoC dollar fix on Friday was 6.7415, 49bp stronger than a day earlier and the strongest since October 2016. In the spot market, the onshore RMB (CNY) was trading at 6.7616 against the dollar, 0.03% higher than the last close, as of 10.20am, according to Money.net data. The offshore RMB (CNH) stood at 6.7593, up 0.12%.

  • The dollar index was down 0.06% to 94.245, with the fall in the year so far reaching 7.79%, according to Bloomberg data. The Thomson Reuters CNY reference index closed at 93.63 on July 20, down 0.4% and the weakest since the end of May.

  • Shanghai Pudong Development Bank Hong Kong branch was given approval to enter the interbank foreign exchange spot market on July 20 by China Foreign Exchange Trade System.


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