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Asia Pacific Financial News from John Lothian News

Lead Stories

China Bans Brokerage CEOs From Time Off, Trips Amid Congress
Bloomberg News
CSRC is said to give order before party congress on Oct. 18; Policy makers want to ensure stable markets for the gathering
As China’s most important political event in years draws nearer, regulators have made it clear to the nation’s top financiers that they don’t want to see any major turbulence in markets.
https://goo.gl/GKdWSJ

Chindia Needs One More Thing From Apple; The new iPhones are too expensive for many emerging-market consumers.
By Tim Culpan – Bloomberg
Apple Inc.’s long-awaited release of three new iPhone models has many would-be consumers pondering whether to go all-in with $999 for the iPhone X or settle for the lesser iPhone 8 or iPhone 8 Plus.
https://goo.gl/tDGp5M

Floods May Cost South Asia $215 Billion a Year by 2030
By Archana Chaudhary and Bibhudatta Pradhan – Bloomberg
Mounting climate change dangers threaten businesses, growth; Unplanned urban sprawls, lack of climate planning to add costs
As global attention focused on hurricanes Harvey and Irma, more than 41 million people across South Asia battled floods and displacement.
https://goo.gl/ziw1LB

North Korea’s opaque trading network keeps economy afloat; Web of rusty ships and shell companies perpetuates flows despite tightening sanctions
Don Weinland in Hong Kong, Yuan Yang in Dalian and Demetri Sevastopulo in Washington – FT
For a Hong Kong company managing a small fleet of cargo ships, Union Link International hoists an exotic array of flags, from China and Tanzania to the Pacific island nations of Niue and Palau.
https://goo.gl/AitTWe

North Korea’s Nuke Test May Have Been Twice as Strong as Thought
By David Tweed – Bloomberg
North Korea’s latest nuclear test may have been more than twice as powerful as first thought — or 17 times stronger than the Hiroshima bomb — according to an analysis by 38 North.
https://goo.gl/fkSH4T

Asia-listed Apple suppliers mixed after iPhone X launch
Alice Woodhouse – FT
Asia-listed companies that supply parts to Apple put in a mixed performance on Wednesday following the reveal of the US company’s iPhone X.
https://goo.gl/tz2c1Z

FinTech News

London to Tokyo FX route receives upgrade; Upgraded link to Japan expected to cater for growing FX demand in the region.
By John Bakie – The Trade
Network provider BSO has upgraded its London to Tokyo route to provide lower latency for FX trades.
https://goo.gl/srKHQv

In China’s Hinterlands, Workers Mine Bitcoin for a Digital Fortune; One of the largest sources of Bitcoin can be found in the grasslands of Inner Mongolia, despite Chinese skepticism over its potential for risk.
By CAO LI and GIULIA MARCHI – NY Times
They worked as factory hands, in the coal business and as farmers. Their spirits rose when a coal boom promised to bring factories and jobs to this land of grassy plains in Inner Mongolia. When the boom ebbed, they looked for work wherever they could.
https://goo.gl/LqmPPG

China’s ICO ban makes more sense in light of its history with fintech
Nik Milanovic – TechCrunch
China’s decision to freeze fundraising through initial coin offerings continues to roil markets, but the regulatory decision may not be as controversial as the response from the bitcoin community would lead observers to believe.
https://goo.gl/6DQ2St

5 Things to Know About China’s Ant Financial Services Group; A look at the Alibaba affiliate that created and manages the world’s largest money-market fund
By Chuin-Wei Yap – WSJ
Ant Financial Services Group, which created and manages Yu’e Bao, the world’s largest money-market fund, is a financial-technology company started by billionaire Jack Ma, the founder and executive chairman of Chinese tech giant Alibaba Group Holding Ltd. BABA +1.33% Mr. Ma is Ant’s controlling shareholder but isn’t involved in day-to-day management.
https://goo.gl/A2SM1K

Regulatory News

‘Not scared’: Australian regulator takes aim at country’s powerful banks
Swati Pandey, Paulina Duran – Reuters
Australia’s corporate regulator took aim at the nation’s four major banks, saying the powerful institutions “with a lot of hubris” aren’t used to being taken on by regulators who have stepped up scrutiny of the scandal-hit sector.
https://goo.gl/Uc4gfL

Applications for crowd-funding licences open 29 September 2017
ASIC
From 29 September 2017, the new crowd-sourced funding (CSF) regime will come into effect and ASIC will begin accepting licence applications from CSF intermediaries.
https://goo.gl/3M8Aud

Founder of online Chinese lender sentenced to life for fraud
Associated Press
The founder of a Chinese online peer-to-peer lender has been sentenced to life in prison on charges he defrauded investors of $7.7 billion in one of China’s biggest financial scams.
https://goo.gl/f8Cqn6

SFC Issues Warning Against 3 Financial Services Companies; The companies were carrying out financial activities without a license and using Hong Kong based bank accounts
Colin Firth
The Hong Kong financial regulatory authority, the Securities and Futures Commission (SFC), has issued a warning against 3 financial services companies for carrying on FX and finance related business in an unlicensed manner.
https://goo.gl/J6o7im

Governments want to control cryptocurrencies — but there’s a danger to too many rules
Regulators in the U.S., Singapore, Japan and China are looking into regulatory measures to control the growth in digital tokens; China recently made it illegal for companies to raise new funds by issuing virtual tokens; Some worry that too much regulation could stifle innovation and go against an original tenet of cryptocurrencies: privacy; But others say there are net benefits to having some regulatory oversight
Saheli Roy Choudhury – CNBC
Cryptocurrencies have exploded in popularity in recent years, thanks to innovation in blockchain, the distributed ledger technology underpinning those virtual tokens such as bitcoin.
https://goo.gl/rteoj7

Investing News

China Prepares Sale of $2 Billion in U.S.-Dollar Bonds; Issue would be country’s biggest-ever U.S.-dollar bond sale and its first since 2004
By Manju Dalal and Carolyn Cui – WSJ
China is laying the groundwork for its first sale of U.S.-dollar sovereign bonds in more than a decade, a move toward expanding its ties with global investors as its economy improves.
https://goo.gl/nupZf3

CEO’s S$6.1m Share Purchase Sends This Singapore Stock to 10-Year High
By Livia Yap – Bloomberg
Singapore’s Venture Corp. received a boost from its Chief Executive Officer Wong Ngit Liong Wednesday — the stock soared as his S$6.1 million purchase of 400,000 shares announced Tuesday inspired the market to follow suit.
https://goo.gl/dfj1uw

Rich People From These Nations Hide the Most Offshore Wealth; The top 0.01 percent isn’t paying a big chunk of its tax bill
By Jeanna Smialek – Bloomberg
Pinpointing the inequality between rich and poor is notoriously difficult because the data is so squishy, and new research shows just how hard that job can be.
https://goo.gl/JLA9FB

Unlocking the value of corporate sustainability
by Kelly Cooper – CSR Asia
In today’s business world, transparency is a license to operate. Customers no longer have to guess how businesses are run ­– access to information is available at their fingertips. Investors are making proactive, sustainability-focused decisions based on increased business opportunities and market access, improved brand reputation, risk aversion and increased capital.
https://goo.gl/FJgV91

Japan

Japan’s MUFG says picks Amsterdam as EU investment banking base
Taiga Uranaka – Reuters
Japan’s Mitsubishi UFJ Financial Group Inc (MUFG) (8306.T) said it has picked Amsterdam as its European Union investment banking base, as financial institutions prepare for Britain’s exit from the EU.
https://goo.gl/WBZtfs

Banker Fees on Japan Post Deal Are Said to Top Tobacco Sale
By Takahiko Hyuga and Maiko Takahashi – Bloomberg
Underwriters face challenge of marketing to retail investors; Fees are said to be 0.7% versus 0.5% on JT’s 2013 offering
Japan’s government will pay higher fees to banks managing its sale of a $12 billion stake in Japan Post Holdings Co. than it did when divesting Japan Tobacco Inc. four years ago, reflecting the additional challenge for underwriters, according to people with knowledge of the matter.
https://goo.gl/bMHffs

Mainland China

Chinese premier on guard against financial risks; Li stresses economy’s overall health in roundtable with global organizations
ISSAKU HARADA, Nikkei
While China’s financial system is generally sound and stable, the government is still keeping a close eye on certain high-risk areas, Premier Li Keqiang told reporters Tuesday after a meeting with leaders from six international institutions.
https://goo.gl/DDXH8J

Xi Jinping Projects a False Sense of Economic Calm Ahead of His Coronation; No turmoil can be allowed to spoil the political pageantry, as the president prepares to cement his power
By Andrew Browne – WSJ
The Chinese economy is in a strange kind of limbo
https://goo.gl/cehd2b

Yuan Fixing Takes Center Stage, Again
Bloomberg News
Central bank sets rate weaker than expected third day in a row; Onshore yuan fell 0.7% last two days, most in emerging Asia
China’s yuan fixing is back in focus, with a run of surprises moving the market in recent days.
https://goo.gl/rYXamH

China needs at least eight more first-tier cities: economist; Beijing, Shanghai, Guangzhou and Shenzhen have failed to drive economic development in their respective regions
By ASIA TIMES STAFF
China needs at least eight more first-tier cities, said Guan Qingyou, deputy director of Minsheng Securities and chief economist of the Minsheng Think Tank. Nine cities, including Tianjin, Hangzhou, Chengdu, Wuhan, Nanjing, Chongqing, Xi’an, Suzhou and Hefei are expected to be the nation’s next first-tier centers, Yicai.com reported.
https://goo.gl/KBWFuH

Hong Kong

Two Dozen Bidders in Fray to Buy AXA’s Wealth Management Unit in Hong Kong-Sources
By REUTERS via NY Times
About two dozen bidders, mainly from China, are vying to buy the Hong Kong wealth management unit of AXA SA, which the French insurer is looking to sell as it focuses on fast-growing businesses in Asia, three people familiar with the matter said.
https://goo.gl/1oG3bH

China and Hong Kong demand boosts Richemont jewellery sales
Ralph Atkins – FT
Swiss luxury goods group Richemont has reported a 12 per cent rise in sales in the five months to August 31 in constant currencies, boosted by jewellery and strong performances in China and Hong Kong.
https://goo.gl/fcZV6W

Indonesia

Indonesia tightens rules to curb money laundering, terror funding
Channel News Asia
Indonesia has issued new regulations aimed at curbing money laundering and terror-related financing across a broader range of financial service providers, including money changers, credit card issuers and electronic money providers.
https://goo.gl/w3srbm

Vietnam

Exclusive: Scandal-hit Vietnam official had been cleared by previous government
Matthew Tostevin – Reuters
A former Vietnamese official who Germany says was kidnapped in Berlin to face charges in Hanoi over financial losses at a state construction firm had been cleared of wrongdoing by the previous government, according to documents seen by Reuters.
https://goo.gl/dqDJKi

Thailand

SE Asia Stocks-Thailand rises for 10th session, hits 24-yr high
By Chris Thomas – Reuters
Thai shares rose to their highest in
nearly 24 years on Wednesday, set for a 10th straight session of gains, while most other Southeast Asian stock markets edged up in tandem with Wall Street, which hit record highs overnight.
https://goo.gl/RMCiQv

South Korean

South Korea, China discussing currency swap extension; Friction over missile defense clouds future of Seoul’s forex safety net
KIM JAEWON, Nikkei
The Bank of Korea is in talks with its Chinese counterpart over extending their 360 billion yuan ($56 billion) currency swap deal, a critical mechanism in the event of a financial crisis, the South Korean central bank said on Wednesday.
https://goo.gl/s59kqR

Australia

Australia can profit from Brexit, provided Britain stays open; Optimism is tempered by uncertainty about the direction of British economic policy
Alexander Downer – FT
Australia may have been watching from afar as Britain joined the European Economic Community in 1973, but we still reacted with anger and disappointment. Now, as we watch Britain preparing to walk back out, our emotions may be less febrile, but we remain deeply concerned about the eventual outcome.
https://goo.gl/bTuE7U

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About Author

Lothian is executive chairman of John J. Lothian & Co. and editor of the John Lothian Newsletter. He publishes MarketsWiki.com, MarketsReformWiki.com, MarketsWikiEducation.com, JohnLothianNews.com and several industry newsletters.