New Market Study Published: Hong Kong Commercial Banking Report Q3 2011

June 11, 2011 - PRLog -- CNH Market: Rate Cut To Bolster Progress  The offshore yuan deposit rate cut should strengthen demand for yuan-denominated investment products  in Hong Kong, keeping the nascent CNH market on a firm growth trajectory. Given investors'  expectations of yuan appreciation and the currency's increasing usage in trade settlement, we believe  yuan deposit growth will not be derailed. Overall, the CNH market presents exciting opportunities for  Hong Kong's economy, but we highlight that key challenges remain.  The People's Bank of China's decision to cut the offshore interest rate by 27 basis points (bps), from  0.99% to 0.72%, could boost liquidity in the CNH market (ie: the offshore CNY market in Hong Kong).  Indeed, the reduced rate could encourage lenders to launch more yuan-denominated investment products,  which have increased at a much slower pace than yuan-denominated deposits. Meanwhile, although the  lowered deposit rate has reduced the attractiveness of the yuan carry trade, we believe yuan deposit  growth will not be derailed. On the whole, the CNH market has very promising growth prospects, but  there are several challenges that must be overcome before Hong Kong can fully savour its vast potential.    Yuan Product Offerings To Remain Popular  The yuan deposit rate cut should make yuan-denominated financial investment products even more  attractive to investors, leading to their continued proliferation in Hong Kong and keeping the nascent  CNH market on a firm growth trajectory. Indeed, we expect the CNH bond market -- also dubbed the  'dim sum bond' market -- to continue flourishing, as issuers are drawn to the low funding costs and  investors remain hungry for yuan-denominated investment options. For instance, Anglo-Dutch  conglomerate Unilever issued CNY300mn (US$45.8mn) worth of dim sum bonds on March 28 2011,  following in the footsteps of US fast-food giant McDonald's Corporation's issue in August 2010 and  Caterpillar Financial Services' issue in November 2010. Despite the aggressive low yield of 1.15%,  Unilever's dim sum bonds were quickly snapped up by investors, clearly demonstrating the strong  demand for yuan-denominated debt amid a limited supply of such yuan investment options. In addition,  several of China's top banks are also reportedly looking to tap into the nascent dim sum bond market,  reaffirming the mainland's commitment to developing Hong Kong as the global offshore yuan centre.    Meanwhile, investment opportunities for the rapidly surging yuan deposits in Hong Kong will continue to  expand and yuan-denominated initial public offerings (IPOs) are the latest major development in the  CNH market. Indeed, Hui Xian REIT launched Hong Kong's first yuan-denominated stock offering in  April 2011. Given Hong Kong's vibrant IPO market (the largest in terms of proceeds in 2010), it is  unsurprising that the CNH business is expanding into the equity market. Moreover, the Hong Kong  Exchanges and Clearing is studying the possibility of creating a yuan liquidity pool to facilitate the  trading of yuan-denominated securities (by sourcing yuan from local banks and providing the currency to  investors through brokers) and we believe such a move will help lay the groundwork necessary to allow  such a market to take off.

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Full Report Details at
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Partial Table of Contents:

Executive Summary
- Table: Levels (HKDbn)
- Table: Levels (US$bn)
- Table: Levels At November 2010
- Table: Annual Growth Rate Projections 2011-2015 (%)
- Table: Ranking Out Of 59 Countries Reviewed In 2011
- Table: Projected Levels (HKDbn)
- Table: Projected Levels (US$bn)
SWOT Analysis
- Hong Kong Commercial Banking SWOT
- Hong Kong Political SWOT
- Hong Kong Economic SWOT
- Hong Kong Business Environment SWOT
Business Environment Outlook
- Commercial Banking Business Environment Ratings
- Table: Commercial Banking Business Environment Ratings
- Commercial Banking Business Environment Rating Methodology
- Table: Asia Commercial Banking Business Environment Ratings
Global Commercial Banking Outlook
Asia Banking Sector Outlook
- Table: Banks' Bond Portfolios
- Table: Asia Commercial Banking Business Environment Ratings
- Table: Comparison of Loan/Deposit, Loan/Asset And Loan/GDP Ratios
- Table: Anticipated Developments In 2011
- Table: Comparison Of Total Assets, Client Loans And Client Deposits, 2009-2010 (US$bn)
- Table: Comparison Of Per Capita Deposits, 2010e (US$)
- Table: Interbank Rates And Bond Yields, 2010-2011
Hong Kong Banking Sector Outlook
Economic Outlook
- Table: Hong Kong Economic Activity, 2008-2015
Competitive Landscape
- Market Structure
- Protagonists
- Table: Protagonists In Hong Kong's Commercial Banking Sector
- Definition Of The Commercial Banking Universe
- List of Banks
- Table: Licensed Banks In Hong Kong
Company Profiles
- HSBC
- Table: Key Statistics For HSBC, 2007-2009 (HKDmn)
- Bank of China (Hong Kong)
- Table: Key Statistics For Bank of China (Hong Kong), 2008-2009 (HKDmn)
- Standard Chartered Bank (Hong Kong)
- Table: Stock Market Indicators
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Hang Seng Bank
- Table: Stock Market Indicators
- Table: Balance Sheet (HKDmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Bank of East Asia
- Table: Stock Market Indicators
- Table: Balance Sheet (HKDmn, unless stated)
- Table: Balance Sheet (US$mn, unless stated)
- Table: Key Ratios (%)
- Wing Hang Bank
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Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.