Caixin
Mar 29, 2019 05:06 AM
CX DAILY

CX Daily: Beijing Has Approved its First Chinese-Foreign Pension Insurance Provider

Heng An Standard Life, a joint venture between U.K. insurance giant Standard Life Aberdeen PLC and Tianjin TEDA International. Photo: VCG
Heng An Standard Life, a joint venture between U.K. insurance giant Standard Life Aberdeen PLC and Tianjin TEDA International. Photo: VCG

Beijing approves first Chinese-foreign pension insurance provider

Heng An Standard Life, a joint venture between U.K. insurance giant Standard Life Aberdeen PLC and Tianjin TEDA International, has received permission to set up a pension insurance business in China, the China Banking and Insurance Regulatory Commission said, becoming the first foreign-Chinese pension joint venture in the country.

China’s pension insurance industry is currently dominated by eight domestic firms. The move to allow the joint venture into China’s pensions market comes amid a national push to open up the financial industry.

Heng An Standard Life, in which Standard Life Aberdeen and Tianjin TEDA both hold a 50% stake, was set up in 2003. It brought in 3.28 billion yuan in revenue from health, life and savings insurance premiums last year, and has businesses in provinces and cities across China, including Beijing and Tianjin.

FINANCE & ECONOMICS 

1

With the benchmark Shanghai Composite Index up more than 20% this year, demand for convertable bonds has taken off. Photo: VCG

In-depth /

Closed loophole could weaken brokerage stranglehold on convertible bonds

The recent dominance of brokerages and fund houses over China’s red-hot market for newly issued convertible bonds could weaken after the country's regulators closed a loophole that had given them an advantage in bidding for the securities.

China’ securities regulator this week announced that most institutional investors will no longer be allowed to use multiple accounts to make offline bids for the bonds. The success that brokerages and fund houses have had in bidding on these popular bonds has shed light on how a disparity in rules for securities accounts had left certain types of investors with a huge advantage over their competitors in one of the less tightly restricted corners of China’s securities market.

Fintech /

Hong Kong plugs virtual banks, issuing first licenses

Hong Kong’s monetary authority issued the first batch of virtual bank licenses to Livi VB Ltd., SC Digital Solutions Ltd. and Zhongan Virtual Finance Ltd., three companies backed by mainland tech giants and financial institutions, in a move to tap into smart banking and fintech expansion.

The Hong Kong Monetary Authority, the region’s de facto central bank, said Wednesday the licenses would take effect March 27, and services will be officially launched within the next six to nine months.

Transaction clearing /

Visa is setting up a wholly foreign-owned firm in China

Visa Inc. is planning to set up a wholly foreign-owned company in China and is in the process of applying for a transaction clearing license for onshore yuan.

Alfred F. Kelly Jr., CEO of Visa, told us that the global credit-card giant has begun groundwork for the clearing business to prepare for the operation if it obtains the license. The move follows archrival MasterCard Inc.'s announcement last month to form a joint venture with China’s newly launched online clearinghouse Nets Union Clearing Corp.

Coming up /

Sunday, March 31: NBS will release its March report on China’s official PMI.

Monday, April 1: Caixin will release its Caixin China General Manufacturing PMI.

Wednesday, April 3: Caixin will release its March Caixin China General Services PMI.

Friday, April 5: China's stock markets will close April 5-7 for the Qingming Festival.

Quick hits /

Opinion: Foreign investment law more than a face-saving gesture

High-tech board to vet listings based on innovation capabilities

BUSINESS & TECH 

ZTE

The ZTE logo outside the Mobile World Congress in Barcelona, Spain, Feb. 25. Photo: VCG

ZTE /

Clash with Washington drove ZTE $1 billion into the red last year

Embattled ZTE Corp. shuttered nine of its subsidiaries last year as the Chinese telecom-equipment maker reported a loss of 6.98 billion yuan ($1.04 billion) for 2018 after being thrown into crisis by a high-profile clash with Washington.

The loss was in part due to a $1.4 billion fine slapped on ZTE by the U.S. authorities for selling U.S.-made products to Iran in violation of sanctions. Nine of its subsidiaries have shut down, including ZTE Photovoltaics Technology Co. Ltd., ZTE Group Finance Holdings (Hangzhou) Ltd., and Shenyang (ZTE) Big Data Research Co. Ltd.

Supply & demand /

Pollution crackdown sends cement sector profits skyward

A national crackdown on polluting industries has reduced supply in the cement industry, which has boosted both prices and profits of major producers as the sector goes through a period of consolidation.

One beneficiary has been industry leader Anhui Conch Cement Co. Ltd., which reported an 88.05% jump in its net profit last year to 29.8 billion yuan ($4.43 billion). The Shanghai- and Hong Kong-listed enterprise reported total revenue of 128.4 billion yuan in 2018, an increase of 70.5%, according to its annual results released last week.

The great selloff /

Cathay Pacific agrees to buy HNA’s stake in HK Express

HNA Group has agreed to sell its 18% stake in the budget airline Hong Kong Express Airways Ltd. to Cathay Pacific Airways Ltd. as the debt-ridden conglomerate’s latest move to shed assets and pay down debt.

The deal is part of a plan for Cathay Pacific to acquire 100% of HK Express for HK$4.93 billion ($628 million) in cash and debt, Cathay Pacific said, adding that HNA reached the sale agreement with Cathay in its role as HK Express’s guarantor. The deal has yet to get regulatory approval, while a major shareholder of HK Express also declared he will contest the agreement.

Restaurants /

Hot pot chain Haidilao issues first fiscal report after IPO and global expansion

Hot pot chain Haidilao’s first fiscal report after its IPO is out, and the results aren’t bad, particularly considering the company’s rapid expansion globally and sizable spending on human capital.

The addition of 200 new restaurants, boosting Haidilao’s worldwide total to 466, helped push the company’s revenue up 59.5% YOY to 16.97 billion yuan ($2.52 billion) for the year ended Dec. 31, 2018. Net profit attributable to owners of the company surged 60.1% to 1.65 billion yuan.

Sportswear /

Adidas opens mega Asia HQ in Shanghai

Sportswear giant Adidas opened an official new regional HQ in Shanghai Wednesday, hoping to consolidate its leading position in greater China’s sporting goods markets.

The 21-floor mega-office in central Shanghai will house more than 1,500 staff overseeing projects in China, Japan, South Korea, Southeast Asia and the Pacific. An internal integration of its markets was completed earlier this year, prior to the opening of the physical building, according to Adidas’s official 2018 fiscal report.

Quick hits /

Survey finds 90% of China’s minors are online

5G competition should be between companies, not countries: Former U.S. official

Five health sector firms apply to list on new high-tech board

Crackdown concerns dampen appetite for latest online learning IPO

PetroChina parent finds fourth exec under investigation — in three months

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