China

Chinese banks are wrestling with rising funding costs both inside and outside China's borders, at a time when these banks are expected to lend more to bolster China when its trade and real-estate sectors are sagging, The Wall Street Journal reported. In China's interbank market, state-owned banks have seen a jump in the interest rates charged amongst themselves in recent days, leading the country's central bank to cut its bank-reserve requirements on Saturday, its second such move in four months. The reduction in reserve-requirement ratio, effective Feb.

China took action to boost bank lending as it seeks to fine-tune economic policy to support growth, without giving up its recent gains in controlling inflation and property prices, The Wall Street Journal reported. The People's Bank of China said on Saturday that it will cut banks' reserve requirement ratio by 0.5 percentage point, effective Feb. 24, in a move to help boost liquidity and support the economy. The reserve requirement ratio is the percentage of deposits that banks must hold in reserve rather than lend out.

A mountain of debt is coming due and the principal is unpayable, so governments have agreed to extend maturities. This could be a description of a bail-out package for Greece. Instead, it is what China is doing to prevent scores of provinces and cities from defaulting on bank loans, the Financial Times reported. Does that mean China is another Greece? Far from it. For starters, China’s economy will expand more than 8 per cent this year, while the eurozone is confronting the likelihood of recession.

Officials will increase support for construction of affordable housing and ensure that “loan demand from first-home families” is met, the People’s Bank of China said on its website yesterday, Bloomberg reported. A government clampdown aimed at make housing affordable is cooling prices and driving down transactions as Europe’s sovereign-debt crisis caps export demand. Fitch Ratings said yesterday that a “hard landing” for China’s economy is a key global risk, after the International Monetary Fund cautioned Feb. 6 that a deterioration in Europe could cut the nation’s growth rate almost in half.

Chinese Premier Wen Jiabao on Friday sought to assuage concerns over Chinese investment in Europe, saying China has no intention to "buy" the continent, The Wall Street Journal reported. At a business forum in the southern province of Guangdong during a state visit by German Chancellor Angela Merkel, Mr. Wen said China is "willing to cooperate with Europe to fight the current crisis." "Some people say this means China wants to buy Europe. This is a concern and doesn't fit reality,'' he added. "China doesn't have this intention, and doesn't have this ability." Mr.

Chinese carmaker Zhejiang Youngman Lotus Automobile has made a 3 billion crowns ($446 million) offer for bankrupt Swedish group Saab which has drawn a cool response from receivers, a source with knowledge of the situation said on Friday, Reuters reported. The receivers want bids for parts of Saab rather than the whole business as that would raise more for creditors, the source said. Saab was declared bankrupt last December after months of efforts to keep it afloat by owner Swedish Automobile. "Youngman made an offer for all of Saab on Monday.

Prime Minister Wen Jiabao said Thursday that China would consider working with the International Monetary Fund to help shore up Europe’s finances. But he left unclear whether China was willing to drop conditions that so far have made its proposed help unappealing to European nations, the International Herald Tribune reported. While Chinese leaders have pledged not to link political demands to financial investments, they have sought concessions, such as getting the European Union to relax trade strictures against low-cost Chinese goods. Mr.

China's Premier Wen Jiabao said the nation's government debt is at an "overall safe and controllable" level, that funding for key projects would be ensured and that applying the brakes to the economy would be done in a way to avoid systemic risks, Reuters reported. Wen's comments, reported in the official People's Daily on Monday, were made in a speech dating back to early January at the government's flagship financial work conference. Wen pledged to contain and defuse local government debt risks and avoid the spread of financial risks.

China’s banking regulator is weighing a plan to relax capital requirements for lenders after the world’s second-largest economy expanded at the slowest pace in 10 quarters, four people with knowledge of the matter said, Bloomberg reported. The China Banking Regulatory Commission is delaying implementing the most stringent capital adequacy ratios and may lower risk weightings for loans to small businessmen and companies, the people said, declining to be identified as the matter is confidential.

Chinese group Zhejiang Youngman Lotus Automobile could make a fresh bid for failed Swedish carmaker Saab next week, sources with knowledge of the situation said on Wednesday, Reuters reported. Saab was declared bankrupt by a Swedish court in December after protracted rescue efforts by owner Swedish Automobile. A key stumbling block was the refusal of former owner General Motors to allow its technology, which underpins Saab cars, to fall into Youngman's hands.