27/03/2026

BIZ & FINANCE FRIDAY | MAR 27, 2026

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China considers easing bank shareholding limits

Philippine central bank holds key rate MANILA: The Philippine central bank decided to keep its policy rate at 4.25% during a surprise off-cycle meeting yesterday and said its monetary policy would focus on second round effects from global oil price shocks. Governor Eli Remolona said the off-cycle meeting was required because close attention needed to be paid to a fast-changing and uncertain economic environment, which he described as “a very unusual situation”. The Bangko Sentral ng Pilipinas, which was not scheduled to review interest rates until April 23, said mounting risks to inflation required sustained vigilance. Remonola said monetary policy would be blunt amid current upside risks to inflation, so maintaining the current rate was manageable. The BSP saw economic growth of 4.4% this year and 5.9% in 2027, he said. “Monetary policy will focus on addressing likely second round effects of the oil price shocks: for that we will remain vigilant. “We will be guided by data and we will act as needed to pursue our primary mandate.” Inflation was forecast at 5.1% this year, above the 4% ceiling, but would move back to 3.8% in 2027, he said, adding the BSP was closely monitoring core inflation in particular. In a statement issued minutes earlier, the BSP said it expected economic growth to remain weak in 2026, and raising the policy rate at this time would delay the recovery. – Reuters Indonesia may relax production quotas for nickel and coal JAKARTA: Indonesia, a major producer of thermal coal and nickel, may relax production quotas for both commodities if prices remain high, its energy minister said. “If the prices remain stable, good, we may do what we call a measured relaxation on production plans,“ Bahlil Lahadalia said in a statement late on Wednesday after a meeting with President Prabowo Subianto. “Everything is still being coordinated with the market and the supply and demand, too.” Indonesia is the world’s top exporter of thermal coal and nickel products. It has announced plans to cut mining output quotas for many of its minerals to help support prices this year. Indonesia also said it would cut its coal production quota to 600 million metric tons, from about 790 million tons produced last year. The nickel ore production quota, known as RKAB, has been set at 260 million to 270 million tons, the energy ministry has said, lower than the demand of around 340 million to 350 million tons, as estimated by Indonesia’s nickel smelter association FINI. FINI chairman Arif Perdana Kusumah said yesterday the association welcomed the relaxation plans. – Reuters

NFRA to increase their bank holdings, with the regulator reviewing their qualifications and the urgency of a bank’s capital needs on a case-by-case basis, the person said. The plan to ease ownership rules in China’s US$70 trillion banking sector, at a time when lenders’ balance sheets and asset quality have been hit by the economic downturn and the property sector crisis, has not been reported previously. Rising geopolitical tensions and turbulent global markets are intensifying the push to bolster domestic banks’ balance sheets, as Beijing accelerates support for strategic industries. Any relaxation to broaden funding channels to include well-capitalised investors would come at a time when traditional fiscal support has become harder to sustain, the sources said, adding discussions are at an early stage and subject to change. The NFRA did not respond to Reuters’ requests for comment. The planned easing in bank ownership rules would roll back parts of a near-decade-old effort by the world’s second-largest economy to curb the influence of dominant shareholders in financial institutions. Those curbs followed the collapse of insurance giant Anbang Group and the failure

head of financials at CreditSights. “Investors are looking through the current implications, but new issue concessions do vary depending on the day and the volatility levels. Covered bonds are the safest asset class and there is always demand – these are AAA-rated.” Westpac priced its Jan 2, 2031 covered bond at 28 basis points over mid-swaps with a 3.119% coupon. Barclays, BNP Paribas, Commerzbank, HSBC, Natixis and Westpac acted as joint leads. Macquarie Bank launched a dual-tranche US dollar senior unsecured issue comprising three-year fixed-rate and floating-rate notes due March 29, 2029. BofA Securities, Citi, Goldman Sachs, HSBC, Macquarie Capital and Wells Fargo were joint bookrunners. – Reuters of Baoshang Bank and included orders barring major shareholders from abusing their rights to interfere with operations of the banks or insurers. The state takeover of Baoshang Bank was triggered by the improper and illegal use of bank funds by Tomorrow Holdings, which held 89% of the bank’s shares, leading to a serious credit crisis, according to a central bank statement at that time. China’s sovereign fund and provincial government-backed investment firms control most large, listed banks, while insurers, asset managers and central government-owned conglomerates are among major shareholders. Tighter ownership rules and limited access to private capital, especially for smaller regional lenders, have left China’s banking sector largely reliant on state recapitalisation in recent years. Earlier this month, China said at its annual parliamentary meeting it would inject 300 billion yuan (RM176 billion) into state-owned banks this year to guard against systemic risk, following a roughly US$72 billion recapitalisation last year. As part of the ongoing discussions, the regulator is also mulling easing shareholding restrictions for large state-owned insurers’ investments in banks, said a person, adding the aim is to channel those investments into smaller city-commercial banks. Several large insurers have already hit the 5% shareholding cap in two commercial banks and therefore must keep investments in any additional banks below that threshold, analysts said. China’s major state-owned banks have capital levels that meet regulatory thresholds, but face pressure to replenish buffers as the need to support the economy will continue to push up risk-weighted assets, according to a Fitch report. Chinese lenders plan to direct more credit to technology-focused firms, bankers have said, as Beijing steps up its push to embed artificial intelligence across the economy. While this offers banks a fresh source of lending growth, analysts warn the nascent nature of the targeted companies and the lack of proper collateral in some cases could pose asset-quality risks. Smaller, regional banks face even greater challenges in bolstering their capital than their larger peers, as they grapple with narrower profit margins and greater pressure to dispose of bad loans. China’s top leadership, meanwhile, has vowed to “strengthen capital replenishment through multiple channels”, according to a government work report delivered at the annual meeting of the National People’s Congress earlier this month. – Reuters

SHANGHAI: China is considering easing shareholding restrictions for some major investors, people with knowledge of the matter said, in a move aimed at broadening capital-raising options for commercial banks reeling from an economic slowdown. The National Financial Regulatory Administration (NFRA), the country’s banking sector regulator, in January held a meeting with some bank representatives to discuss the potential relaxation, said the people. Under rules introduced in 2018, a single investor can hold 5% or more, considered a major shareholder, in no more than two commercial banks, or can have a controlling stake in only one lender. The regulator is now weighing allowing some bank shareholders to become major investors in one to two additional lenders, said one of the people, who declined to be named as the discussions are not public. Shareholders would need approval from the o Regulator aims to broaden funding channels amid economic downturn

People look on next to a logo of Industrial and Commercial Bank of China at a trade fair in Beijing. – R EUTE R S PIC

Asian borrowers raise US$2.8b as LG Energy, Westpac tap debt market SINGAPORE: Asian borrowers raised upwards of US$2.8 billion (RM11.2 billion) yesterday as investors scooped up high-grade debt amid uncertainty over the Middle East war and the outlook for oil and interest rates. “Investor demand for Asian investment-grade credit remains strong, with significant capital available for deployment,“ he said. green notes, according to deal statistics. BofA Securities, Citigroup, Credit Agricole CIB, HSBC and JPMorgan acted as joint bookrunners on the sale.

“There is a big pipeline waiting to get done, and clients are maintaining a state of readiness to capitalise on favourable issuance windows as they emerge, as we saw earlier this week.” LG Energy’s senior unsecured deal comprised US$300 million of 2029 notes priced at 5.0%, US$500 million of 2031 notes at 5.25%, US$300 million of five-year floating-rate notes at the compounded daily secured overnight financing rate, or SOFR, plus 156 basis points, and US$500 million of 2036 green notes at 5.875%. Final orders topped US$2.8 billion for the 2029 notes, more than US$3 billion for the 2031 notes, over US$2 billion for the floating-rate tranche and above US$3.5 billion for the 2036

When contacted by Reuters, LG Energy said in a statement that it had finalized plans to issue the bonds on Wednesday, and the funds raised “will be used for debt repayment, domestic and overseas capital expenditures, raw material purchases, and other general corporate purposes”. Westpac declined to comment. Macquarie did not immediately respond to an emailed request for comment. “Credit spreads in Asia have not widened much and there is demand for new issues and well-known and high-quality issuers,“ said Pramod Shenoi, head of Asia-Pacific research and

South Korean battery company LG Energy Solution priced a US$1.6 billion four-part US dollar bond sale, Australia’s Westpac Banking Corp sold a €1 billion (RM4.6 billion) covered bond and Macquarie Bank launched a benchmark-sized US dollar senior deal, according to term sheets seen by Reuters. The deals follow a US$1.8 billion debt plan unveiled by AIA on Monday. “During periods of global uncertainty, the flight to quality is very apparent and there’s a clear preference for top-rated issuers,” said Daeil Ahn, director for debt capital markets in Korea at Citi.