China's fifth-largest bank downgraded to junk status

[MuhammedAli]

UN, the Moody's shit, n everything else white man controls is for sake of their hold and their own benefit. No one apart from them ever will get any good from the organisations they have created.

 

[HariPrasad]

You should take a finance course in an international university and there you'll know about the financial acument of the Chinese.

Don't blow your trumpet sitting in your well. Nobody can hear it.

Get out. See the world. Then comment.

Already have management accounting degree and I can go to US and practice without passing any US exam.

 

[Keel]

"The decision to downgrade Bank of Communications was based on the lender's lack of customer deposits and over- reliance on expensive and volatile alternative sources of funding, Moody's said today."

those are absolute ridiculous reasons to downgrade BoComm to "junk" level. There are plenty of options where the Bank can improve their deposit levels such as by giving incentives. The bank needs to act more aggressively in marketing though. May be opting for a further shares issuance with bonuses when the market sentiment is right. One of the positive note from their annual report is they are able to control the increase of bad loans.

So best of luck BoComm. Hope you can tide over the bad and malicious attacks.

Chimes are good at manufacturing but their financial acumen is doubtful. I do not think that they can survive.

If that should happen, the Heaven forbid, then india will plunge ahead of China surely - a decade before!

Identified: 12 insolvent accounts responsible for 25% of toxic assets on bank balance sheet
By Pratik Bhakta
Jun 14, 2017
Read more at:
http://economictimes.indiatimes.com...ofinterest&utm_medium=text&utm_campaign=cppst

NPA crackdown: Read here for financial details of these 12 big loan defaulters likely to go for bankruptcy
Jun, 17 2017
http://www.firstpost.com/business/n...ters-likely-to-go-for-bankruptcy-3693353.html

Now, RBI prepares second list of over 40 defaulters
TNN | Aug 30, 2017
http://timesofindia.indiatimes.com/...f-over-40-defaulters/articleshow/60284766.cms

 

[ito]

This is serious. If China's fifth largest government owned bank is not worth the investment, meaning all is not well with the Chinese economy.

 

[Tauren Paladin]

Donald Trump did say he'll sanction Chinese banks that supported the North Korean regime.

Central Bank of India

Moody's has downgraded CBI's long term local and foreign currency bank deposit ratings to Ba3 from Ba1. At the same time, Moody's has affirmed the bank's BCA and Adjusted BCA at b3. Moody's has also downgraded the bank's long term CRA to Ba2(cr) from Ba1(cr). The short-term local and foreign currency bank deposit rating was affirmed at Not-Prime and the banks' short-term CRA was affirmed at Not-Prime(cr). The outlook, where applicable, is maintained at stable.

The downgrade of CBI's long-term deposit ratings reflect the banks's weak BCA of b3 and some moderation in our expectation of extra ordinary support from the Indian government given the issues outlined earlier in this press release. As such, the uplift from the BCA has been lowered to three notches compared to the earlier five notches.
https://www.moodys.com/research/Moo...f-seven-and-downgrades-the-ratings--PR_369980

The fall of India's crappy economy.

 

[ohmrlobalobayeh]

This is serious. If China's fifth largest government owned bank is not worth the investment, meaning all is not well with the Chinese economy.

The last time i checked, top 4 of the world's largest banks by total assets are Chinese banks while this particular Chinese bank in topic is in the top 10, remarkably with another 7 Chinese banks down the line- making a grand total of 12 Chinese banks in the top 50 largest banks by total assets.

Astonishingly, despite india proclaiming itself to be a world major superpower, there is not even a single indian bank even in the top 50- does this means the indian economy is failing?

Hahahaha just go chew your grass.

 

[seesonic]

This is serious. If China's fifth largest government owned bank is not worth the investment, meaning all is not well with the Chinese economy.

Save it.

“We need to deal with legacy issues that hold back growth and bring changes to enhance the efficacy of our business processes and conduct,” RBI governor Raghuram Rajan

You pesky cyber warriors have no idea the disaster India banks are looming

 

[Keel]

This is serious. If China's fifth largest government owned bank is not worth the investment, meaning all is not well with the Chinese economy.

Read on the above posters and the following article to brighten yourself up a bit for their wisdom on the subject.
China is a shining beacon to the world's economy
We will be the last to stand when others may fall.

For the persistent, incorrigible, naive and openly wilful cursers of everything Chinese, bad mouthing China is like biting the hands that feed you. Read the following:-

Why China is central to global growth
https://www.weforum.org/agenda/2016/09/why-china-is-central-to-global-growth
02 Sep 2016
Stephen S. Roach, Senior Fellow, Jackson Institute of Global Affairs, Yale University

Despite all the hand-wringing over the vaunted China slowdown, the Chinese economy remains the single largest contributor to world GDP growth. For a global economy limping along at stall speed – and most likely unable to withstand a significant shock without toppling into renewed recession – that contribution is all the more important.

A few numbers bear this out. If Chinese GDP growth reaches 6.7% in 2016 – in line with the government’s official target and only slightly above the International Monetary Fund’s latest prediction (6.6%) – China would account for 1.2 percentage points of world GDP growth. With the IMF currently expecting only 3.1% global growth this year, China would contribute nearly 39% of the total.

That share dwarfs the contribution of other major economies. For example, while the United States is widely praised for a solid recovery, its GDP is expected to grow by just 2.2% in 2016 – enough to contribute just 0.3 percentage points to overall world GDP growth, or only about one-fourth of the contribution made by China.

A sclerotic European economy is expected to add a mere 0.2 percentage points to world growth, and Japan not even 0.1 percentage point. China’s contribution to global growth is, in fact, 50% larger than the combined 0.8-percentage-point contribution likely to be made by all of the so-called advanced economies.

Image: BBC
Moreover, no developing economy comes close to China’s contribution to global growth. India’s GDP is expected to grow by 7.4% this year, or 0.8 percentage points faster than China. But the Chinese economy accounts for fully 18% of world output (measured on a purchasing-power-parity basis) – more than double India’s 7.6% share. That means India’s contribution to global GDP growth is likely to be just 0.6 percentage points this year – only half the 1.2-percentage-point boost expected from China.

More broadly, China is expected to account for fully 73% of total growth of the so-called BRICS grouping of large developing economies. The gains in India (7.4%) and South Africa (0.1%) are offset by ongoing recessions in Russia (-1.2%) and Brazil (-3.3%). Excluding China, BRICS GDP growth is expected to be an anemic 3.2% in 2016.

So, no matter how you slice it, China remains the world’s major growth engine. Yes, the Chinese economy has slowed significantly from the 10% average annual growth recorded during the 1980-2011 period. But even after transitioning from the “old normal” to what the Chinese leadership has dubbed the “new normal,” global economic growth remains heavily dependent on China.

There are three key implications of a persistent China-centric global growth dynamic.

First, and most obvious, continued deceleration of Chinese growth would have a much greater impact on an otherwise weak global economy than would be the case if the world were growing at something closer to its longer-term trend of 3.6%. Excluding China, world GDP growth would be about 1.9% in 2016 – well below the 2.5% threshold commonly associated with global recessions.

The second implication, related to the first, is that the widely feared economic “hard landing” for China would have a devastating global impact. Every one-percentage-point decline in Chinese GDP growth knocks close to 0.2 percentage points directly off world GDP; including the spillover effects of foreign trade, the total global growth impact would be around 0.3 percentage points.

Defining a Chinese hard landing as a halving of the current 6.7% growth rate, the combined direct and indirect effects of such an outcome would consequently knock about one percentage point off overall global growth. In such a scenario, there is no way the world could avoid another full-blown recession.

Finally (and more likely in my view), there are the global impacts of a successful rebalancing of the Chinese economy. The world stands to benefit greatly if the components of China’s GDP continue to shift from manufacturing-led exports and investment to services and household consumption.

Under those circumstances, Chinese domestic demand has the potential to become an increasingly important source of export-led growth for China’s major trading partners – provided, of course, that other countries are granted free and open access to rapidly expanding Chinese markets. A successful Chinese rebalancing scenario has the potential to jump-start global demand with a new and important source of aggregate demand – a powerful antidote to an otherwise sluggish world. That possibility should not be ignored, as political pressures bear down on the global trade debate.

All in all, despite all the focus on the US, Europe, or Japan, China continues to hold the trump card in today’s weakened global economy. While a Chinese hard landing would be disastrous, a successful rebalancing would be an unqualified boon. That could well make the prognosis for China the decisive factor for the global economic outlook.

While the latest monthly indicators show China’s economy stabilizing at around the 6.7% growth rate recorded in the first half of 2016, there can be no mistaking the headwinds looming in the second half of the year. In particular, the possibility of a further downshift in private-sector fixed-asset investment could exacerbate ongoing pressures associated with deleveraging, persistently weak external demand, and a faltering property cycle.

But, unlike the major economies of the advanced world, where policy space is severely constrained, Chinese authorities have ample scope for accommodative moves that could shore up economic activity. And, unlike the major economies of the developed world, which constantly struggle with a tradeoff between short-term cyclical pressures and longer-term structural reforms, China is perfectly capable of addressing both sets of challenges simultaneously.

To the extent that the Chinese leadership is able to maintain such a multi-dimensional policy and reform focus, a weak and still vulnerable global economy can only benefit. The world needs a successful China more than ever.