BRIEFING - ASIA BANKING - APRIL 22, 2009

An executive briefing on banking for April 22, 2009, prepared by Asia Pulse (http://www.asiapulse.com), the real-time, Asia-based wire with exclusive news, commercial intelligence and business opportunities.

SHIKHA SHARMA QUITS INDIA'S ICICI PRUDENTIAL FOR AXIS BANK

NEW DELHI - ICICI Prudential Life Insurance Managing Director and CEO Shikha Sharma on Tuesday resigned from India's largest private sector life insurer to join Axis Bank (BSE:532215).

Sharma tendered her resignation to the board of ICICI Prudential Life, sources said.

ADB SAYS REGIONAL CAPITAL MARKETS START TO STABILISE

HANOI - Asia's emerging capital markets are starting to stabilise and Asian relatively resilient economies will help them recover as the global crisis ebbs and investor appetite returns, the Asian Development Bank (ADB) said on April 21 in its annual report.

However, the road to recovery for the region's equity, bond and currency markets will not be even given the uncertainty about the length and severity of the current economic downturn, the bank said in the Asia Capital Markets Monitor, an annual publication that assesses the status and challenges for the region's markets.

CHINA BOND FUNDS TO HOLD MORE DEBENTURES WITH SHORTER DURATION

BEIJING - Bond funds in China are likely continue their strategy of increasing investments in debenture and convertible bonds while lowering their portfolio durations in the second quarter, reported Tuesday's China Business News, a leading financial newspaper in the country.

China's bond market weathered a drastic correction during the first quarter thanks to a higher-than-expected expansion of bank loans, which rekindles fears of long-term inflation.

INDIAN CENTRAL BANK'S RATE CUTS WILL BOOST DEMAND: REALTY PLAYERS

NEW DELHI - Realty developers and property consultants on Tuesday hailed the Reserve Bank of India's (RBI) decision to further cut short term lending and borrowing rates, saying that the move would help boost demand in the housing sector.

They, however, demanded lending institutions should respond positively to the RBI's move by providing loans to customers as well as industry at more cheaper rates.

BANK INDONESIA LIQUIDATES IFI BANK

JAKARTA - Bank Indonesia has announced the liquidation of Bank IFI after the bank failed to meet required sound banking conditions while the bank was under supervision.

"Based on the decision of Bank Indonesia governor, Bank Indonesia revoked Bank IFI's license," Bank Indonesia's head of financial system stability, Wimboh Santoso, said here on Friday.

AUSTRALIAN BONDS CLOSE WEAKER - APRIL 22, 2009

SYDNEY - The Australian bond market closed weaker on Wednesday as a rally on Wall Street had investors selling fixed-income assets.

At 1630 AEST, the yield on the Commonwealth Government March 2019 bond was 4.460 per cent, up from Tuesday's close of 4.370 per cent, while the yield on the April 2012 bond was at 3.540 per cent, up from 3.485 per cent.

SRI LANKA SAYS ACCESS NOT INTEREST RATE MATTERS IN MICRO-FINANCE

COLOMBO - Low transaction costs and timely delivery is critical for micro-finance to be effective in lifting poor people out of poverty, a senior Sri Lankan central bank official said.

"Experience tells us that micro-finance alone is not enough to eliminate poverty because it only satisfies the funding needs of micro enterprises," central bank deputy governor W A Wijewardena told an international symposium on microfinance in Colombo.

CHINA'S CREDIT GROWTH TO FALL IN APRIL, BUT TO REMAIN HIGH FOR Q2

BEIJING - China's new loans are expected to grow slower in April as compared with that in the previous month but the aggregation for the second quarter of 2009 will remain high, Shanghai Securities News cited an authorized source as saying.

It's learned that the outstanding of bank loans declined in the first two weeks of April, with that in China's top four state-owned banks, namely the Industrial and Commercial Bank of China, China Construction Bank, the Bank of China and Agricultural Bank of China, falling 90 billion yuan (US$13.2 billion) from that at the same time of March.

PAKISTAN CENTRAL BANK CUTS POLICY RATE BY 100 BPS TO 14 PCT

KARACHI - State Bank of Pakistan (SBP) Monday said it has been decided to slash its policy rate by 100 basis points from 15 per cent to 14 per cent from April 21, 2009.

This was announced by SBP Governor Syed Salim Raza at a press conference here while releasing Monetary Policy Statement for April-June quarter of the current fiscal year 2008-09.

BANKS IN VIETNAM ISSUE US$13.4 BLN IN SUBSIDISED LOANS

HANOI - About 236.82 trillion VND (US$13.38 billion) has been injected into the economy at the Government-subsidised interest rate of 4 per cent.

The State Bank of Vietnam (SBV) said State-owned banks and central credit funds have loaned 175.93 trillion VND since the rate was launched early last month.

KAGARA STOCKS RISE ON WESTPAC'S US$35 MLN DEBT EXTENSION

PERTH - Shares in Kagara Ltd (ASX:KZL) rose after Westpac Banking Corp (ASX:WBC) agreed to extend the maturity date for the zinc and copper miner's A$50 million (US$35.5 million) debt facility by four months to October 31.

Kagara shares were up six cents, or 7.23 per cent, at 89 cents at 1540 AEST.

VIETNAM BANKS ISSUE US$13.4 BLN IN SUBSIDISED LOANS

HANOI - About 236.82 trillion VND (US$13.38 billion) has been injected into the economy at the Government-subsidised interest rate of 4 per cent.

The State Bank of Vietnam (SBV) said State-owned banks and central credit funds have loaned 175.93 trillion VND (US$9.94 billion) since the rate was launched early last month.

NO CHANGE IN CHINA EXPANSION PLANS: UBS

BEIJING - Switzerland's largest bank UBS is committed to expansion plans in China despite several cost reduction initiatives undertaken globally due to the effects of the financial downturn, a company executive told China Daily during an exclusive interview.

"We will reduce the total size of the business globally, but not in China," Lord Brittan, vice-chairman of UBS Investment Bank, said.

NATIONAL UZBEK BANK Q1 DATA SHOWS US$3.9 BLN BALANCE

TASHKENT - The National Bank of Uzbekistan's first quarter accounts show it has 1.891 million clients and a consolidated balance of 5.577 trillion soums (US$3.9 billion), including off-system turnover of 4.227 trillion soums.

The bank's credit portfolio made up 2.123 trillion soums as of April 1, 2009.

EMERGING ASIAN CAPITAL MARKETS TO STABILISE, SAYS ADB

BANGKOK - Emerging Asia's capital markets are starting to stabilise and the region's relatively resilient economies should help them recover as the global crisis ebbs and investor appetite returns, according to the Asian Development Bank (ADB).

Nevertheless, the road to recovery for the region's equity, bond and currency markets will be long and hard given persistent uncertainty about the length and severity of the current economic downturn, said the Asia Capital Markets Monitor, a new annual publication from ADB that assesses the status and challenges for the region's markets.

CHINA SEES 13 CROSS-BORDER M&A DEALS IN Q1

BEIJING - China saw more active M&A deals in the first quarter this year compared with the same period of last year, according to a research report on China's M&A market during the first quarter of this year released by Zero2IPO Group on Monday.

In the first quarter, 13 M&A cases occurred in the Chinese market, up 30 per cent on the year. Only ten of those cases with prices disclosed totaled US$475 million, up 87.6 per cent on the year.

WB PROVIDES US$60 MLN TO MODERNISE VIETNAM'S FINANCIAL SECTOR

HANOI - A concessional credit of nearly US$60 million to modernise Vietnam's financial sector was signed by the State Bank of Vietnam (SBV) and the World Bank (WB) in Hanoi on April 21.

The credit comes from the International Development Association (IDA) in the form of a soft loan provided by the WB for low-income countries and has a duration of 40 years with a 10-year grace period.

UZBEKI BANK TURKISTON INCREASES CHARTER CAPITAL

TASHKENT - Turkiston Bank of Uzbekistan, a private open-joint stock commercial investment bank, has placed its seventh issue of ordinary shares for 2 billion soums (US$1.4 million).

The bank issued 2 million shares with par value of 1,000 soums each. The placement of the shares raised the charter capital of Turkiston Bank for 5.3 billion soums. The bank said the raise of the authorized capital will significantly expand business of the bank. Recently, the bank adopted decision to increase charter capital to 10 billion soums till 2010.

CREDIT RISK FOR MARGINAL SOUTH KOREAN FIRMS LINGERS: EXPERTS

SEOUL - A set of fiscal and monetary policies helped ease the strain on corporate financing, but credit risks for South Korea's marginal companies still exist, experts said Wednesday.

"In this regard, a corporate restructuring for troubled companies will help dispel uncertainty in the market," said a statement released after Bank of Korea (BOK) Gov. Lee Seong-tae held a meeting with five economic experts.

AUSTRALIAN BOND MARKET WEAKER AT NOON - APRIL 22, 2009

SYDNEY - The Australian bond market was weaker at noon.

At 1200 AEST, the yield on the Commonwealth Government March 2019 bond was 4.440 per cent, up from Tuesday's close of 4.370 per cent, while the yield on the April 2012 bond was at 3.520 per cent, up from 3.485 per cent.

AUST KLEENMAID CREDITORS TO EXPECT BAD NEWS FROM ADMINISTRATORS

BRISBANE - Kleenmaid creditors are expected to receive bad news at their first meeting with administrators on Thursday.

The Queensland-based appliance retailer went into administration on April 9, owing about A$73 million (US$51.83 million).

AUST FIN SERVICES GRP TRUST CO SEES NET PROFIT RISE OF 1.5%

SYDNEY - Australian financial services group Trust Company Ltd has increased net profit by 1.5 per cent but expects significantly lower operating earnings for fiscal 2010.

Trust reported on Wednesday annual net profit of A$20.6 million (US$14.63 million) for the 12 months to February 28, 2009.

PNG INTEROIL DENIES CHEAP GAS DEAL WITH CHINESE CO

PORT MORESBY - Papua New Guinea's (PNG) InterOil Corporation has denied claims that it has agreed to sell cheap gas to China, reports NBC.

A company statement issued Sunday described a media report on the deal as baseless and untrue.

MAYBANK WANTS TO ACQUIRE PPA'S ASSET IN MAYBANK INDOCORP

JAKARTA - Malayan Banking (Maybank) Berhad has proposed to acquire a 3.17 per cent stake of state asset management company PT Perusahaan Pengelola Aset (PPA) at PT Maybank Indocorp.

PPA President Boyke Mukkijat said he has received the proposal from Maybank, which already owns 96 per cent of Maybank Indocorp .

AXA APH ASSETS UNDER MNGMNT DROP US$53 BLN IN SLOW Q1 SALES

MELBOURNE - Slow first quarter sales following "severe market dislocation" dragged AXA Asia Pacific Holdings Ltd's (ASX APH)(ASX:AXA) assets under management down by five per cent to A$74.8 billion (US$53.11 billion) in the quarter to the end of March.

In Australia, the corresponding figure for funds under management, administration and advice dropped 14 per cent to A$52.87 billion for the quarter.

MANY INDONESIAN BANKS FACE "RISKY CONDITIONS": ECONOMISTS

JAKARTA - Following last week's liquidation of IFI bank by Bank Indonesia (BI), economists warned on Tuesday of risky conditions of about 40 to 50 small banks in the country, advising the central bank that it should ask them to merge.

Of the 130 banks in Indonesia, only about 15 large banks have good levels of capital adequacy ratio (CAR), non-performing loan (NPL) and deposit ratios. The 15 large banks control about 70 per cent of overall bank assets.

AUST'S TELSTRA WINS US$71 MLN COMMONWEATH BANK CONTRACT

SYDNEY - Telstra Corp (ASX:TLS) has won a contract from Commonwealth bank of Australia Ltd (ASX:CBA), worth up to A$100 million (US$71 million) per year, to provide telecommunication services as the bank upgrades its network.

Australia's biggest telecommunications provider won the ten-year contract from the country's biggest lender to provide fully-managed telecommunications services to Commonwealth branches, EFTPOS network and automatic teller machines, the companies said in a statement on Wednesday.

AUSTRALIAN BOND MARKET OPENS WEAKER - APRIL 22, 2009

SYDNEY - The Australian bond market opened weaker on Wednesday, as risk appetite returned on a rebound in US equity markets.

At 0830 AEST, the yield on the Commonwealth Government March 2019 bond was 4.472 per cent, up from Tuesday's close of 4.370 per cent, while the yield on the April 2012 bond was at 3.565 per cent, up from 3.485 per cent.

MACQUARIE GROUP OFFERS LIFELINE TO SMALL BRISCONNECTIONS INVESTORS

SYDNEY - Macquarie Group Ltd (ASX:MGQ) has offered a financial lifeline to small BrisConnections (ASX:BSCA) investors, many of whom face huge potential debts, offering to pay their remaining instalments if they give up their holding for free.

Macquarie Group says it will pay all remaining liabilities to about 80 per cent of unitholders in the BrisConnections Investment Trust, including the second instalment of one dollar per BrisConnections unit on 29 April 2009 and third instalment of one dollar per security on 29 January next year.

AXA ASIA PACIFIC TO AXE UP TO 120 JOBS MAINLY IN MELBOURNE

PERTH - Insurance and superannuation giant AXA Asia Pacific Holdings Ltd (ASX:AXA) could slash up to 120 full-time staff to curb costs as the global financial market meltdown takes its toll on the sector.

"We have announced some proposed changes that may result in up to 120 positions being made redundant," a company spokeswoman told AAP on Tuesday evening.

CHINA HOPES RICE FUTURES CONTRACT MEANS BIGGER GLOBAL PRICE ROLE

ZHENGZHOU - China started the trading of early rice futures contracts Monday on the Zhengzhou Commodity Exchange, in central Henan Province, with the goal of a larger role in global grain prices.

Early rice is a major grain product in China. The new contract means that all major farm produce items in China now have futures contracts.

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