Banking
Chinese Banks to Sell Yuan Bonds in Taiwan
TAIPEI – Taiwan is allowing Chinese companies to issue yuan bonds on the island following a similar move by Hong Kong that increases the use of the Chinese currency in offshore markets, and Chinese banks are set to be the first issuers.
Earlier this year, Taiwan allowed companies—except those from China—to issue yuan bonds for the first time. Already, companies have raised nearly 4 billion yuan (US$656.4 million) through the sale of six bonds in the island’s fledgling yuan-bond market, and the Financial Supervisory Commission’s decision Wednesday to allow Chinese companies to issue yuan bonds to institutional investors will help deepen Taiwan’s bond market.
Major Chinese lenders including Bank of Communications Co., Agricultural Bank of China Ltd. and China Development Bank are set to be among the first issuers of yuan-denominated bonds, or Formosa bonds, in Taiwan.
“The Taiwanese are among the most important credit investors in the region, so I think Taiwan will continue to be a thriving [offshore yuan] market, even though it appeals more to domestic investors, unlike Hong Kong,” said Guy Stear, Asia head of research at Société Générale.Hong Kong was the first offshore yuan market and remains the biggest by volume. As part of Beijing’s push to promote the use of the Chinese currency offshore, it has struck various deals with Taipei, Singapore and London in the past year ranging from yuan clearing to swaps to investment products to quotas for investments in Chinese stocks and bonds.
Taiwan’s onshore banks started taking yuan deposits in February, after Beijing and Taipei established a direct yuan-clearing system in late January. Taiwan’s domestic yuan deposits totaled 123.25 billion yuan by the end of October, a fraction of Hong Kong’s pool of around 730 billion yuan.
Taiwan’s institutional investors are channeling most of their overseas yuan funds into Hong Kong-issued yuan bonds, which are also known as dim-sum bonds, the regulator said. The new rule is likely to bring some of those funds back to the island.
China’s policy banks, state-owned banks, commercial banks and their overseas branches will be able to issue yuan bonds after gaining approval from Taiwan’s GreTai Securities Market, which offers over-the-counter trading mechanisms for local bonds, Taiwan’s financial regulator said. China-based subsidiaries of Taiwanese financial institutions and affiliates of Taiwan-listed Chinese companies also qualify, it said.The Hong Kong branch of China’s Bank of Communications, or BoCom, submitted its application Wednesday to issue 1.2 billion yuan ($197 million) worth of Formosa bonds, underwriter HSBC Holdings PLC said.
“Demand for the BoCom yuan bond is very strong and it is already oversubscribed,” said Adam Chen, head of global markets in Taiwan at HSBC.
“Orders are still coming in,” he said.
“Taiwan is a newly opened market. Many Chinese companies are indeed very interested [in issuing yuan bonds in Taiwan].”
Agricultural Bank of China’s Hong Kong branch also plans to issue 1.0 billion yuan bonds, an official at GreTai said. BoCom could get the green light as early as this week and must list the bonds on GreTai within one month of obtaining approval, the official said.Apart from the two Chinese lenders, policy bank China Development Bank is preparing to issue yuan bonds in Taiwan within the next two months, a person familiar with the situation said, without providing further details.
With a wider selection of bonds, “foreign investors, such as hedge funds in Singapore, will also become more interested in yuan bonds issued in Taiwan…and that will certainly help boost the domestic yuan businesses,” said Hunter Yeh, head of fixed income, currencies and commodities trading at UBS AG’s Taiwan operations.
Taiwan requires foreign investors to pay a 15% tax on bond investments, while locals are subject to a 10% tax. In neighboring Hong Kong, all bonds are tax-free.
“But still there are incentives for both issuers and investors [in Taiwan,]” said Frances Cheung, a strategist at Crédit Agricole.
Local investors, especially insurers, are keen on investing in yuan bonds, while strong demand for the instrument could encourage Beijing to allow Issuers to sell more yuan bonds offshore, Mr. Cheung said.
– WALL STREET JOURNAL
Banking
Millions of customers still stranded worldwide 24 hours after GT Bank online operations suffered attacks
By Yemie ADEOYE
GT Bank, one of Nigeria’s leading banks, with operations across Africa and the United kingdom, and with an asset base of about US$3.11 trillion is under a cyber attack which has left millions of its customers across the world stranded in the last 24 hours.
The bank which was renowned for its seamless online operations at inception has suffered dwindling online efficiency in recent years and this current attack didn’t come as a surprise to many of its numerous customers. However, it is becoming worrisome that over 24 hours after its online operations went down, the bank has not been able to arrest the situation and restore its online services.
Stranded GT Bank customers outside the banks premises
Several customers of the bank took to their X (formerly known as twitter) handles to express their frustrations at the bank, as several of the customers in the diaspora are unable to access their accounts and carry on with their transactions. A customer , Jeff55 who lamented on his X handle about the development, stated that it is a thing of shock that a bank of this size couldn’t afford to have the necessary tools and experts to ensure a full protection of its online operations in this age and time.
Another customer Dimma stated that while Cybersecurity training may seem tedious, the recent #GTBank hack is a stark reminder that everyone is just a click away from a devastating attack.
Several media organisations had reported that hackers have stolen GT Bank website, and intercepted customers Data in massive phishing operation.
At the time of filing this report, Biztellers.com.ng checks on the banks website shows that it is still down and unaccessible, and neither GT Bank media and communications unit nor any of its agencies or surrogates have commented officially on the development.
Says output surge buoyed by reforms he announced in May 2024 to address gaps in PIA
President Bola Ahmed Tinubu on Sunday declared a resurgence in the oil & gas industry, commending the increased crude production to 1.6 million barrels per day.
The president, who said this in a national broadcast, maintained that the resurgence was buoyed by the reforms he announced in May 2024 to address the gaps in the Petroleum Industry Act (PIA).
Nigeria’s crude oil output got a boost to 1.61 million barrels per day in July 2024 through the president’s directive and the industry leadership provided by the Nigerian National Petroleum Company Limited (NNPCL).
Acknowledging what he called a resurgence of the once-declining oil and gas industry in his Sunday-morning broadcast to the nation, President Tinubu said that oil investors are coming back to Nigeria.
He said; “Our once-declining oil and gas industry is experiencing a resurgence on the back of the reforms I announced in May 2024 to address the gaps in the Petroleum Industry Act. Last month, we increased our oil production to 1.61 million barrels per day, and our gas assets are receiving the attention they deserve. Investors are coming back, and we have already seen two Foreign Direct Investments signed of over half a billion dollars since then.
Read Also : BREAKING: Sell Crude To Dangote Refinery In Naira – Tinubu To NNPC Ltd
“Fellow Nigerians, we are a country blessed with both oil and gas resources, but we met a country that had been dependent solely on oil-based petrol, neglecting its gas resources to power the economy.
We were also using our hard-earned foreign exchange to pay for and subsidise its use. To address this, we immediately launched our Compressed Natural Gas Initiative (CNG) to power our transportation economy and bring costs down.
This will save over two trillion Naira a month, being used to import PMS and AGO and free up our resources for more investment in healthcare and education.
“To this end, we will be distributing a million kits of extremely low or no cost to commercial vehicles that transport people and goods and who currently consume 80% of the imported PMS and AGO.
“We have started the distribution of conversion kits and the setting up of conversion centres across the country in conjunction with the private sector. We believe that this CNG initiative will reduce transportation costs by approximately 60 per cent and help to curb inflation.”
Plans are in top gear for the 11th Annual General Meeting (AGM) of the FBN Holdings Plc.
The management made this disclosure in a notice it filed with the Nigerian Exchange Limited (NGX) on Thursday, where it averred that it has not been served with any court order against the proposed AGM.
According to notice, which was signed by the acting Company Secretary, Adewale Arogundade, FBN Holding said, “The attention of FBN Holdings Plc (the Company) has been drawn to recent media reports purporting that the Company has received a Court Order stopping it from holding the Annual General Meeting (AGM) scheduled for August 15, 2023.
“We confirm that this assertion is a false narrative as the Company has, as at the date hereof, not been served with any court order to stop the forthcoming AGM.
“Suffice to mention that the AGM is a statutory meeting of Shareholders that must be held in accordance with the law, further to which the Company will notify the regulators and the public as appropriate if there is any lawful order to restrain the Company from conducting same.
“We hereby assure our esteemed Shareholders that the AGM shall hold on August 15, 2023, as planned and we look forward to their attendance and active participation at the meeting.”
However, court orders published in national dailies showed that the Federal High Court in Lagos had issued an order against the financial institution, barring it from holding its 11th AGM.
The order was entered pursuant to a petition by Olusegun Onagoruwa, in suit No: FHC/L/CP/1271/2022. It was addressed to the bank and some other bank officials.
It read, “Take notice that unless you obey the directives in the judicial order contained in the order made on July 15, 2022, by the Federal High Court, Lagos, by refraining from proceeding with the 11th Annual General Meeting of FBN Holdings Limited proposed for August 15, 2023, from seeking approval to issue or raise share capital in any manner whatsoever, from appointing or confirming the appointment of new directors, or in any other manner taking any step towards implementing, actualising enforcing resolution of the 10th Annual General Meeting of FBN Holdings Plc held on June 20, 2022, or in any other manner overreaching, disobeying or undermining the said order of a court, you will be guilty of contempt of court and you will be liable to be committed to prison and to there imprisoned.”
Biztellers brought you a report that a segment of shareholders had staged a protest at the headquarters of the bank on Monday, calling for the AGM to be held, as well as soliciting regulatory interventions.
It is expected that at the AGM, FHN Holdings is poised to breathe life into plans to seek shareholders’ approval to raise N150bn fresh capital via a rights issue and elect new directors including billionaire, Femi Otedola and Samson Ariyibi among other resolutions.
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