Banks told to check for illegal activity

    CHINA’S foreign exchange regulator has ordered major domestic banks to check for possible illegal activity in the currency market, as it tries to clamp down on speculative money flows in and out of the country.

    Banks are being asked to examine cross-border deals involving derivatives and other innovative currency products that may have violated its regulations, the State Administration of Foreign Exchange (SAFE) said in a statement on posted on its website Tuesday. These checks will help banks “curb illegal foreign exchange operations and criminal activities” and limit their risk exposure, the SAFE said.

    ICBC to clear yuan in Bangkok

    INDUSTRIAL and Commercial Bank of China (ICBC) will conduct yuan clearing business in Bangkok, Thailand, China’s central bank said Tuesday.

    The authorization came after an agreement between the two central banks. On Dec. 22, the two extended a currency swap agreement worth 70 billion yuan (US$11.4 billion). ICBC’s Thailand branch has been the largest Chinese bank in the country since it acquired ACL Bank in 2010. Yuan clearing overseas has become a driving force behind the globalization of the Chinese currency. Clearing is now authorized in Hong Kong and Macao, as well as in Doha, Frankfurt, Kuala Lumpur, London, Luxembourg, Paris, Seoul, Singapore, Sydney and Toronto.

    Shenhua to issue unsecured bonds

    CHINA Shenhua Energy Co. said yesterday it plans to issue up to US$1.5 billion in unsecured bonds and use the net proceeds to repay loans of overseas units and to fund overseas projects.

    China Shenhua, the Hong Kong and Shanghai-listed unit of China’s biggest coal producer, said it will commence a series of roadshow presentations beginning around today to professional investors.

    Stocks close up, brokerages strong

    CHINA’S stocks closed up yesterday, hovering around five-year highs, with brokerage shares strengthening after the regulator said it planned to relax rules for securities firms to set up subsidiaries and on background requirements for shareholders.

    The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 0.1 percent to 3,643.79, while the Shanghai Composite Index gained 0.7 percent to 3,373.95 points. The Shenzhen Composite Index was 0.26 percent lower at 1,457.45.