Hong Kong

HSBC cost cuts expose new CEO’s bigger problem

10 Oct 2024

Georges Elhedery may slash $300 mln of expenses in a plan to combine investment and commercial banking, the FT says. Yet the savings are modest and a new super-division may have downsides. Investors will be more interested in how Elhedery keeps the top line growing as rates fall.

China M&A leaves offshore investors in the lurch

10 Oct 2024

The merger of brokerage firms Guotai and Haitong will massively dilute the former's Hong Kong shareholders. Blame the stubborn discount the city's stocks trade at to onshore equivalents. Beijing's consolidation push will leave more global backers in a similar spot.

Hong Kong bourse can go harder on tycoons

8 Oct 2024

Proposed rules aim to make companies listed on the $5 trln market more accountable to independent shareholders. But the changes don’t fully ensure investors’ ability to scrutinise deals or increase their say in board appointments, leaving moguls’ influence unnecessarily intact.

Hong Kong economic pain is marginal gain for LME

4 Oct 2024

Port activity and land prices have fallen so far that the London Metal Exchange is eyeing warehouses in the financial hub. That may spur more Chinese buyers to use the bourse. But despite more than a decade of Hong Kong ownership, storage in mainland China remains out of reach.

AI’s next feat will be its descent from the cloud

2 Oct 2024

Tech giants hoping to spend $1 trln on data centres are struggling to secure power supplies and space. That bolsters the case for smaller artificial intelligence models that can run on devices, not a remote platform. Phone and laptop makers from Apple to Lenovo stand to benefit.

China plays perilous game of pump the stock market

30 Sep 2024

Shares in consumer and real-estate firms have jumped more than a fifth after the latest round of state support raised hopes of a broad recovery. The risk is that when policymakers in Beijing flesh out their plans, the details will fall short of what investors are expecting.

Hong Kong property tycoons enter brave new world

26 Sep 2024

Embattled developer New World may replace its CEO, the third-generation scion of the founding Cheng clan, amid a deepening real estate slump. Such a move is nearly unheard of in the city dominated by family-run conglomerates. It will put peers like Henderson Land on notice.

Beijing IPO meddling leaves bad taste in Hong Kong

23 Sep 2024

Regulators have put three bubble tea firms’ offerings on hold. Why? Because listed peers have performed poorly amid tough competition, Reuters reports. That may be true, but it’s a decision for companies and investors. China’s heavy handedness bodes ill for the city’s bourse.

Autos take driver’s seat in China’s new economy

19 Sep 2024

Beijing wants carmakers to reserve overseas factories for final assembly of vehicles. It will slow tech transfers like those that helped the People's Republic get ahead in the industry. Slowing GDP growth is making China protective of companies as they expand overseas.

Midea listing promises Hong Kong a shot in the arm

12 Sep 2024

The electronics maker’s $3.5 bln offering stands to raise more in one deal than the city has seen all year. With solid earnings, diversified revenue sources and strong investor interest, the share sale could provide a boost to sentiment in the deal-starved market.

China’s banks have a nasty case of indigestion

11 Sep 2024

For decades, Beijing leaned on lenders to fuel growth in the $17 trln economy. But it will take years for them to digest problem IOUs from firms and local governments. Officials will have to find new ways to boost GDP, or the financial dyspepsia could turn into something worse.

Norwegian dreams fuel China’s electric-car bulls

10 Sep 2024

Nio boss William Li says the country could soon resemble Norway, where pure battery-powered models accounted for 94% of sales last month. Though the People’s Republic does share some similarities, a price war and a fad for hybrids mean not all roads lead to Oslo.

China brokerage deal has more bark than bite

9 Sep 2024

The merger of Guotai Junan and embattled rival Haitong will create the country’s largest brokerage with assets of $225 bln. The overcrowded sector needs consolidation, but this deal probably won’t aid Beijing’s goal to foster a squad of world-beating investment banks.

How HSBC can heal the scars of its CEO battle

29 Aug 2024

The $160 bln lender’s retail and wealth head Nuno Matos left after losing out on the top job to Georges Elhedery. The bank now has an empty CFO post, and a lack of potential future leaders. Recruiting heavy-hitting outsiders, like Citi’s Jane Fraser has done, would help.

China’s big ball of money has nowhere else to go

23 Aug 2024

Beijing's warnings slowed a rush into government debt sparked by moribund stocks and falling home prices. With US rates set to fall, investing more abroad would be an option if it weren't for capital controls. Unless they're relaxed, the bond-buying frenzy is likely to restart.

AIA loosens tight Chinese purse strings

22 Aug 2024

The $70 bln insurer reported a 25% increase in new business value in the first half, led by rapid growth in mainland China. Demand for the group's savings products is driving sales as the economy sputters. AIA's aggressive expansion onshore is paying off.

Swire can afford to be optimistic about China

15 Aug 2024

The Anglo-Asian conglomerate is doubling down on airline and property investments in the country while others de-risk. While its options to diversify appear limited, $11 bln Swire Pacific is outperforming peers. Plus Beijing finally has a reason to embrace the trading house.

Hong Kong faces China’s other consumption slump

14 Aug 2024

Spending is weak on the mainland, but retail sales in the financial hub have fallen for four months in a row. That's due to a double whammy of locals and tourists buying less. The city's once resilient landlords are cutting dividends - an ominous sign of more pain to come.

China’s mounting bad debts have fewer places to go

7 Aug 2024

StanChart-backed Bohai Bank is selling $4 bln-worth of non-performing assets. It underscores the pressure lenders are under as property-linked loans sour. Yet distressed-asset managers like Cinda are feeling the strain too. Disposing banks' $470 bln bad debt pile will get harder.

HSBC’s growth engine has insufficient horsepower

31 Jul 2024

Wealth revenue is rising at the $167 bln lender, but not necessarily fast enough to offset the hit from falling rates. The key transaction-banking unit, meanwhile, is stagnant. To fix it, new CEO Georges Elhedery will need investors’ patience and a dose of economic good luck.