China sees less lending and growth

Business | Reuters and Stella Zhai 17 Jan 2020

New bank lending in China fell more than expected in December last year, but lending for all of 2019 still hit a record and yuan peaked at a five-month high after the trade deal.

The onshore yuan once touched 6.8811 per US dollar before paring to 6.885 per dollar as of 4 pm yesterday, up 21 basis points from a day ago.

The Bank for International Settlements said the real effective exchange rate of the yuan rose 1.11 percent during 2019, marking the end of a three-year drop. But the currency's nominal effective exchange rate slid for the fourth consecutive year, down 1.5 percent from a year ago.

Chinese banks extended 1.14 trillion yuan (HK$1.29 trillion) in new yuan loans in December - a 18 percent drop from a month ago and slightly short of analyst expectations, data from the PBOC showed.

China's 2019 gross domestic product is estimated to have grown more than 6 percent, and data for January indicates a better-than-expected economic outlook, Chinese Vice Premier Liu He said.

But HSBC forecast China's economy would only grow by 5.8 percent this year.

Meanwhile, new home prices grew at their weakest pace in 17 months in December, with broader curbs on the sector continuing to cool the market.

Average new home prices in China's 70 major cities rose 6.6 percent in the last month of 2019, slowing from a 7.1 percent gain in the previous month, data from the National Bureau of Statistics showed.

In other news, New Metro Global under Seazen Group (1030) said it will issue US$350 million senior notes at 6.8 percent due August, 2023, while Kaisa Group (1638) also issued US$300 million bonds due 2025 at 9.95 percent coupon rate. Landsea Green (0106), meanwhile, issued US$200 million bonds due 2022 at a coupon rate of 10.75 percent.

Other mainland issuers seemed to accelerate fundraising activities, with ZTE (0763) saying it was looking to raise 11.51 billion yuan from a private placement of A-shares for research and development as well as working capital. The share issuing price was an 18.2 percent discount compared with the closing price of HK$36.92 on Wednesday.

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