Every January, central bankers from the U.S. and Europe meet to discuss the financial industry's issues and problems.

This year's meeting in Basel is especially unique in that it takes place in a post-crisis setting. To emphasize its importance, chief executive bankers from JPMorgan Chase (NYSE: JPM), Citigroup (NYSE: C), Credit Suisse (NYSE: CS), UBS (NYSE: UBS) and Deutsche Bank (NYSE: DB) have been invited. The presence of this wide array of key executives underscores the importance and need to hammer out guidelines for central bankers in the U.S. and Europe.

The Basel Committee on Banking Supervision, which sets world banking regulations, has signalled plans to encourage banks to hold greater capital assets in the future and to make provisions for future bad debts throughout the economic cycle. They are also working on guidelines to ensure that banks hold greater liquidity reserves than they do now.

What is your opinion on these guidelines? Is it too little, too late?

U.S. and European central bankers meet to discuss woes originally appeared on BloggingStocks on Sun, 11 Jan 2009 18:10:00 EST. Please see our terms for use of feeds.

By the end of 2006, the Chinese financial market is supposed to be opened to foreign banks. Don't you believe it. Despite spending $23 billion dollars for stakes in Chinese banks, foreign companies own 2% of Chinese banking assets. Brian Bremner and Dexter Roberts have examined the regulations applying to foreign ownership and control in the Chinese financial sector. Their article, "How Beijing is Keeping Banks at Bay," (Business Week 2 October 2006), asserts that the Chinese government is willing to allow foreign entry into its financial sector only to the degree necessary to assure minimal compliance with its WTO agreement. Foreign entites can open only 1 branch per year, with a $50 million minimum in operating capital. Foreign entities are limited to a maximum of 25% ownership in a Chinese bank. This insures that foreign entities have no effective control over any Chinese banking strategy and/or operations. The banking sector is not independent enough from the Chinese government.

Against this protectionist backdrop, Industrial & Commercial Bank of China (ICBC) is beginning to sell what might turn out to be the world's largest IPO. ICBC officials and underwriters are in Hong Kong this week negotiating the placement of $3.5 billion worth of demand. The initial round of IPO shres is expected to raise $19 bliion according to Kate Linebaugh. "Chinese IPO Gets Star Investors." The largest investment entity will be China Life group, buying $847 million. Kuwait Investment Authority has subscribed for $719 million.

In a disturbing and related piece of information, the Chinese government recently passed a law prohibiting foreign financial information companies from selling data directly to Chinese banks. Only Xinhua, a Chinese publishing company, can distribute financial information in China. The government tries to reduce foreign involvement in the financial sector, bars access to independent thiid-party information, and investors still line up to buy this stock? Just how desparate are people to make a buck in China? Are they desparate enough to leave thier common sense out of the equation?

Chinese banking sector originally appeared on BloggingStocks on Tue, 26 Sep 2006 13:09:00 EST. Please see our terms for use of feeds.