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Wealth-management Products
A wealth management product (WMP; ) is an uninsured financial product sold in China by banks and other financial institutions. Typically they offer a high rate of interest, and sometimes, purportedly guaranteed return. As of 2016, $2.8 trillion had been sold by banks during the previous 5 years. While the government sometimes intervenes to prevent losses by investors, some WMPs have failed. Financial experts such as David Daokui Li of Tsinghua University, a member of the Chinese central bank’s monetary policy committee, believe wealth management products pose substantial risks to China's financial stability. Wealth management products grew rapidly throughout 2015 and 2016. Chinese households, companies and banks held a record balance of $3.9 trillion (26.3 trillion yuan) of WMPs as of June 30, 2016. See also * Corporate debt bubble The corporate debt bubble is the large increase in corporate bonds, excluding that of financial institutions, following the financial crisis of 20 ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
China
China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's most populous country, with a population exceeding 1.4 billion, slightly ahead of India. China spans the equivalent of five time zones and borders fourteen countries by land, the most of any country in the world, tied with Russia. Covering an area of approximately , it is the world's third largest country by total land area. The country consists of 22 provinces, five autonomous regions, four municipalities, and two Special Administrative Regions (Hong Kong and Macau). The national capital is Beijing, and the most populous city and financial center is Shanghai. Modern Chinese trace their origins to a cradle of civilization in the fertile basin of the Yellow River in the North China Plain. The semi-legendary Xia dynasty in the 21st century BCE and the well-attested Shang and Zhou dynasties developed a bureaucratic political system to serve hereditary monarchies, or dyna ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Tsinghua University
Tsinghua University (; abbreviation, abbr. THU) is a National university, national Public university, public research university in Beijing, China. The university is funded by the Ministry of Education of the People's Republic of China, Ministry of Education. The university is a member of the C9 League, Double First Class University Plan, Project 985, and Project 211. Since its establishment in 1911, it has produced many notable leaders in science, engineering, politics, business, academia, and culture. As of 2022, Tsinghua University ranked 14th in the world by the 2023 QS World University Rankings and 16th globally by the 2022 ''Times Higher Education World University Rankings''. In 2021, Tsinghua ranked first in the Asia-Pacific region by ''Times Higher Education World University Rankings#Asia, THE Asia University Rankings'' and the U.S. News & World Report Best Global Universities Ranking, ''U.S. News & World Report''. History Early 20th century (1911–1949) ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Corporate Debt Bubble
The corporate debt bubble is the large increase in corporate bonds, excluding that of financial institutions, following the financial crisis of 2007–08. Global corporate debt rose from 84% of gross world product in 2009 to 92% in 2019, or about $72 trillion. In the world's eight largest economies—the United States, China, Japan, the United Kingdom, France, Spain, Italy, and Germany—total corporate debt was about $51 trillion in 2019, compared to $34 trillion in 2009. Excluding debt held by financial institutions—which trade debt as mortgages, student loans, and other instruments—the debt owed by non-financial companies in early March 2020 was $13 trillion worldwide, of which about $9.6 trillion was in the U.S. The corporate bond market historically centered in the United States. The U.S. Federal Reserve noted in November 2019 that leveraged loans, corporate bonds made to companies with poor credit histories or large amounts of existing debt, were the fastest growing ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Shadow Banking In China
Chinese shadow banking refers to underground financial activity that takes place outside of traditional banking regulations and systems. China has one of the largest shadow banking industries with approximately 40% of the country's outstanding loans tied up in shadow banking activities. Shadow banking in China arose after the People's Bank of China became the central bank in 1983. This encouraged commercial enterprises and private investors to place more of their money in financial products, causing the banking industry to grow. History Shadow banking in China is identified to have first emerged in the late 1990s, however its rapid growth did not come until the period following the GFC in 2007. It is documented that the growth in shadow banking activity was due to the inability of the traditional banking system to meet the spike in demand for funding, due to tight regulation on lending. It is estimated that in the period of 2010–2012, non-financial intermediaries in China grew a ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Local Government Financing Vehicle
A local government financing vehicle (LGFV) (), also known as a local financing platform (LFP), is a funding mechanism by a local government in China. It usually exists in the form of an investment company that borrows money to finance real estate development and other local infrastructure projects. LGFVs can borrow money from banks, or they can borrow from individuals by selling bonds known as "municipal investment bonds" or "municipal corporate bonds" ( or ), which are repackaged as "wealth management products" and sold to individuals. Since local governments in China are not allowed to issue municipal bonds, LGFVs have played a unique role in securing funding for local governments to develop their economies. However, the vehicles rarely make enough returns to pay back their debts, often requiring local governments to raise more money to pay back their creditors. Both the number and the indebtedness of LGFVs have soared in recent years, sparking fears about their inability to re ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Financial Services In China
Financial services in China refers to the services provided in China by the finance industry: banks, investment banks, insurance companies, credit card companies, consumer finance companies, government sponsored enterprises, and stock brokerages. Securities trading The China Securities Regulatory Commission (CSRC) has required since 2004 that newly appointed CEOs, deputy CEOs, and heads of supervisory boards at locally incorporated securities firms all pass a Chinese language ability examination to take up their posts. In 2007, for example, Goldman Sachs partner Richard Ong was denied permission to take the job of CEO at Beijing joint venture Goldman Sachs Gao Hua Securities Co. because of his weak Chinese language abilities. Electronic banking In 1994, China started the "Golden Card Project," enabling cards issued by banks to be used all over the country through a network. The establishment of the China Association of Banks rapidly promoted the interbank card network a ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
