|Bid||0.6510 x N/A|
|Ask||0.6830 x N/A|
|Day's Range||0.6520 - 0.6520|
|52 Week Range||0.5810 - 0.7680|
|Beta (3Y Monthly)||0.48|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||0.04 (5.87%)|
|1y Target Est||N/A|
(Bloomberg) -- Three big Chinese banks extended their drop Wednesday, after a U.S. media report suggested they could face fallout from an investigation into North Korean sanctions violations.China Merchants Bank Co., Bank of Communications Co. and Shanghai Pudong Development Bank Co. fell in Shanghai and Hong Kong trading after the Washington Post said that a U.S. judge found three unidentified Chinese lenders in contempt for refusing to comply with subpoenas related to the probe. Details in court rulings “align with a 2017 civil forfeiture action in which the Justice Department alleged” that the three worked with a Hong Kong company accused of laundering money for a sanctioned North Korean entity, the newspaper said.All three banks said in statements that they were not under investigation for sanctions violations.While the report didn’t suggest any U.S. action against the banks was imminent, the sell-off shows how sensitive investors have become to any indication of a heightening in tensions between China and America. In recent months, news of comments and deliberations by U.S. officials have triggered declines in Chinese stocks, including Iflytek Co. and Hangzhou Hikvision Digital Technology Co. Merchants Bank’s fall in Hong Kong on Tuesday was the most in nearly four years.“People are very sensitive about news related to politics now,” said Jackson Wong, Hong Kong-based director at Amber Hill Capital Ltd. “The North Korea news report can be a big thing, turning into a bargaining chip between the U.S. and China in the trade talks, or it can be a very small thing. The market doesn’t know yet, so it became an excuse for them to sell.”The U.S. court order triggers a provision that could see Pudong Development Bank lose access to dollars, the Washington Post said, a decision that the paper said could be made by U.S. Attorney General William Barr or Treasury Secretary Steven Mnuchin.Mnuchin said in 2017 that the U.S. may impose additional sanctions on China, potentially cutting off access to the U.S. financial system, if it didn’t follow through on a fresh round of United Nations restrictions against North Korea. A spokeswoman for the U.S. District Attorney’s office declined to comment to the Washington Post about whether the government is considering invoking the penalty.Merchants Bank’s stock extended Tuesday’s 4.8% drop and was down 1.6% as of 11:41 a.m. in Shanghai Wednesday and 0.8% in Hong Kong. Shares of Bocom, China’s fifth-biggest bank by assets, were 0.3% lower in the mainland city and down 0.5% in Hong Kong. Pudong Development Bank was trading little changed after falling as much as 0.9% earlier. Bocom’s dollar-denominated, loss-absorbing debt instruments, known as AT1 bonds, fell on Tuesday by the most since March 2018.“We believe it’s likely for the three banks to face fines by the Fed though it’s difficult to predict the verdict,” Dexter Hsu, a Taipei-based analyst at Macquarie Capital Ltd., wrote in a report. He predicts that any penalty will be based on the lenders’ dollar-denominated assets, which could see Bocom take the biggest hit. A 50 basis-point fine could impact the 2019 earnings-per-share for Bocom and Merchants Bank by 7% and 2.8%, respectively, Hsu said.Financial companies have largely avoided being targeted in the trade war between China and the U.S. Chinese officials have often pointed to the opening of their financial system to international firms as an example of its desire to embrace cross-border business. As the dispute has escalated, U.S. President Donald Trump’s administration has focused mostly on China’s technology companies, notably Huawei Technologies Co.“Compared with zooming in on Huawei, targeting systematically important financial companies can potentially deal more damage and brings bigger uncertainty,” said Dickie Wong, executive director of research at Kingston Securities Ltd. in Hong Kong. “The fact that one story sent the banking stocks tumbling showed that investors are still high-strung amid the trade war tension.”Chinese foreign ministry spokesman Geng Shuang said Tuesday that the country has “always seriously implemented” UN Security Council resolutions and also asks its companies to comply.“We are against so-called U.S. long-arm jurisdiction against Chinese companies,” Geng said at a media briefing. “We hope the U.S. will step up bilateral cooperation in financial regulation with other countries and come up with information sharing mechanisms in accordance with domestic laws, and share information through bilateral channels.”Pudong Development Bank said in a statement that the news report related to a U.S. investigation into one of its clients and a subsequent demand for the client’s information. Current rules prevent Chinese entities from disclosing such information to overseas entities without authorization, the lender said, adding that it has not been probed in relation to sanctions violations.Merchants Bank said in an emailed statement that it has always strictly followed Chinese laws, UN regulations and other applicable sanctions and rules, and that it hasn’t been probed in connection to any such violations. Bocom said it isn’t being investigated for a sanctions violation, 21st Century Business Herald reported. Calls to Bocom representatives were unanswered.(Updates shares in eighth paragraph, analyst estimate on the extent of fines in ninth.)\--With assistance from Will Davies, Livia Yap, Lucille Liu, Matt Turner and Russell Ward.To contact Bloomberg News staff for this story: Evelyn Yu in Shanghai at email@example.com;Jeanny Yu in Hong Kong at firstname.lastname@example.orgTo contact the editors responsible for this story: Sam Mamudi at email@example.com, Jeanette RodriguesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Mainland Chinese commercial banks China Merchants Bank, Bank of Communications (Bocom) and Shanghai Pudong Development Bank (SPDB) on Tuesday dismissed allegations they were in possible breach of US sanctions against North Korea.In statements issued after their stocks were hammered by a Washington Post report alleging misconduct, the lenders said they have been complying with international and Chinese laws, and were not involved in any investigations related to a possible breach of the sanctions.China's ministry of foreign affairs voiced its opposition to possible sanctions against the banks. It said Beijing was committed to upholding United Nations Security Council resolutions against North Korea, and that it not only required individuals and financial institutions to follow all sanction resolutions passed by the UN, but had also urged overseas branches of Chinese financial companies to comply with local rules."Meanwhile, we are also opposed to the so-called long arm enforcement imposed by the US authorities on Chinese companies," Geng Shuang, a ministry spokesman, said at a press briefing in Beijing.The Washington Post reported on Monday three large Chinese banks could lose access to the US financial system after a judge found them in contempt for refusing to comply with subpoenas in an investigation into breaches of North Korean sanctions.Shares in China Merchants Bank dropped by more than 8.2 per cent in Shanghai, but recovered after the bank's statement to close 4.8 per cent lower. Photo: Reuters alt=Shares in China Merchants Bank dropped by more than 8.2 per cent in Shanghai, but recovered after the bank's statement to close 4.8 per cent lower. Photo: ReutersThe banks were not identified, but details in the court ruling align with a 2017 civil forfeiture action against Bocom, China Merchants Bank and SPDB, according to the report.The three banks were identified by US authorities in official documents as early as 2016, according to earlier media reports, allegedly for handling bank accounts held by front companies used to enable North Korea to buy commodities, bypassing US sanctions.Other state-owned banks, including Agricultural Bank of China, China Construction Bank and the Industrial and Commercial Bank of China, were also named in earlier investigations by the US Department of Justice.Bocom stock fell by 3 per cent in Shanghai and 3.7 per cent in Hong Kong on Tuesday, following The Washington Post report. Photo: Reuters alt=Bocom stock fell by 3 per cent in Shanghai and 3.7 per cent in Hong Kong on Tuesday, following The Washington Post report. Photo: Reuters"China Merchants Bank has noticed The Washington Post report. It involves information about a US court asking for client information from a Chinese bank," the lender said in its statement.The US authorities should follow the agreement signed by China and the United States on mutual legal help in criminal matters for cross-border evidence collection, said the statement, quoted in mainland Chinese media The Paper.Bocom and SPDB issued statements with similar wording in the afternoon, also cited by The Paper.SPDB specifically acknowledged it had received a requirement from a US legal department to provide information about a client, in addition to other data and information. However, any individual or organisation shall not disclose related information to overseas parties without permission, it said.SPDB was also identified by The Washington Post as "at risk of losing access to US dollars", without any elaboration."I view it as likely to be a politically motivated attack by Trump administration officials looking for excuses to contain and curb China's growth ... It is doubtful that a large bank such as China Merchants Bank would break sanctions, as it has too much to lose," he said.China Merchants Bank dropped by more than 8.2 per cent on Tuesday in Shanghai, but recovered after the bank's statement to close at 36.1 yuan, 4.8 per cent lower. Its H shares dropped by 7.9 per cent to close at HK$38.4 in Hong Kong. Bocom fell by 3 per cent to close at 6.1 yuan in Shanghai. Its H shares eased 3.7 per cent to close at HK$5.95. SPDB fell 3.1 per cent to close at 11.7 yuan in Shanghai.The US excluded China's Bank of Dandong from its financial system in November, 2017, for reportedly helping North Korea evade financial sanctions to launder funds.This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved. Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.
A U.S. judge has found three large Chinese banks in contempt for refusing to comply with subpoenas in a probe into North Korean sanctions violations, the Washington Post reported https://wapo.st/2X6ptOL, adding one of them could lose access to the U.S. financial system. The banks were not identified by the judge, but details in the ruling align with a 2017 civil forfeiture action against Bank of Communications, China Merchants Bank and Shanghai Pudong Development Bank, the newspaper reported.
BEIJING/SINGAPORE (Reuters) - China's five biggest state-owned banks posted a modest growth in quarterly profit as policymakers pushed them to make more loans, but the results still missed expectations amid the lingering impact of an economic slowdown. Net profits at the country's so-called Big Five banks, led by Industrial and Commercial Bank of China Ltd (ICBC), grew by more than 4 percent in the January-March quarter from a year earlier. The gain comes on the heels of disappointing 2018 fourth quarter when four of the five turned in their weakest profit growth in more than two years as business activity slowed and they sharply increased provisions for bad loans.
On Monday, Industrial & Commercial Bank of China Ltd., Bank of China Ltd., China Construction Bank Corp. and Bank of Communications Co. posted higher net income. Including Agricultural Bank of China Ltd., which reported last week, rises at the big five clustered in a range from 4.1 percent to 4.9 percent. At the same time as profit climbed, nonperforming loans as a ratio of total lending dropped – though overall levels of bad debt increased.
BEIJING/SINGAPORE(Reuters) - China's five largest state-owned banks posted modest first-quarter profit growth, though slightly below expectations, as policymakers pushed lenders to make more loans to support the slowing economy. Net profits at the country's so-called Big Five banks, led by Industrial and Commercial Bank of China Ltd (ICBC), grew by more than 4 percent in the January-March quarter from a year earlier. The gain comes on the heels of disappointing 2018 fourth-quarter results that saw four of the five lenders posting their weakest quarterly profit growth in more than two years as business activity slowed and they sharply increased provisions for bad loans.
BEIJING/SINGAPORE, April 30(Reuters) - China's five largest state-owned banks posted modest first-quarter profit growth, though slightly below expectations, as policymakers pushed lenders to make more loans to support the slowing economy. Net profits at the country's so-called Big Five banks, led by Industrial and Commercial Bank of China Ltd (ICBC) , grew by more than 4 percent in the January-March quarter from a year earlier. The gain comes on the heels of disappointing 2018 fourth-quarter results that saw four of the five lenders posting their weakest quarterly profit growth in more than two years as business activity slowed and they sharply increased provisions for bad loans.
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