Categories
Macroeconomics
  • How can deep learning improve finance?

    Source: Larry Cao
    Date Submitted: 09 Dec 2018
    Views: 307
    Downloads: 0
    Larry Cao, Director of Industry Research at CFA Institute, talks about the promises and challenges of deep learning, and how artificial intelligence finds application in the investment industry, in an interview for MioTech.
     
  • The BOJ large-scale purchases of equity index ETFs: Float reduction and its impact on market frictions [UniSA 2018]

    Source: Zhuo Chen, Keeichi Ito, Bohui Zhang
    Date Submitted: 21 Nov 2018
    Views: 273
    Downloads: 9
    The paper investigates the direct impact of the BOJ’s large-scale asset purchase program on stock market liquidity and the spill over effects on markets and firms. The authors find an effect on stock liquidity and price inefficiency due to the biased capital allocation.

    This paper has been submitted to the conference Politics, Stock Markets and the Economy, held at the Centre of Applied Finance and Economics, University of South Australia Business School on 4-5 December 2018.
     
  • 2019 Economic outlook: Extending the long and winding road of the business cycle

    Source: Markus Schomer, CFA
    Date Submitted: 19 Nov 2018
    Views: 543
    Downloads: 33
    Global growth rates are expected to re-converge in 2019, but the forecast comes with several caveats. The US needs to skilfully manage interest rates, China needs to weather US tariffs and stimulate private sector growth, and the EU needs to navigate the Brexit and the Italian budget standoff.
     
  • Drivers and policies affecting China's cross-border investment and financing in aviation

    Source: David Yu
    Date Submitted: 24 Oct 2018
    Views: 119
    Downloads: 11
    Chinese outbound M&A deals have grown exponentially over the past five years. 
    Aviation, including airports, leasing and technology, as well as tourism are favoured industries that are promoted because of policy considerations and strong underlying stability and economics. 
  • Trade finance scorecard: regulation and market feedback

    Source: Steven Beck, Alexander R. Malaket
    Date Submitted: 22 Oct 2018
    Views: 314
    Downloads: 0
    Recognizing the need for robust regulation of international banking and financial flows, ADB debuts a new tool to identify and overcome challenges linked to global regulations, including their interpretation, implementation, and compliance. The Trade Finance Scorecard identifies seven systemic, macro-level elements that are critical to effective regulation.
     
  • Kuznets beyond Kuznets: Structural transformation and income inequality in the era of globalization in Asia

    Source: Saumik Paul
    Date Submitted: 22 Oct 2018
    Views: 45
    Downloads: 0
    Based on empirical studies of a broad selection of Asian countries, this e-book brings together novel conceptual frameworks and empirical evidence on topics related to structural transformation, globalization, and income distribution. 
  • Bank of Japan's ETF purchases as an unprecedented monetary easing policy

    Source: Sayuri Shirai
    Date Submitted: 22 Oct 2018
    Views: 698
    Downloads: 0
    The Bank of Japan's unique quantitative easing tool - purchase of stocks through exchange-traded funds (ETFs) - has affected stock prices and raised concerns about decline of corporate governance, since BOJ is a silent shareholder. Is it time for BOJ to unwind it?
     
  • Inclusive business financing: Where commercial opportunity and sustainability converge

    Source: Noah Beckwith
    Date Submitted: 24 Oct 2018
    Views: 683
    Downloads: 0
    Inclusive businesses help reduce poverty and inequality. Financial institutions have a role to play in financing such businesses through bank debt and private equity, which represent opportunities for investors. 
  • Migration and remittances for development in Asia

    Source: Asian Development Bank, World Bank
    Date Submitted: 24 Oct 2018
    Views: 37
    Downloads: 0
    Remittances play a significant role in the economies of many countries in Asia-Pacific. While online platforms provide cost-efficient channels, remittance-linked investment instruments can better support the countries' growth and development. 
     
  • NZIER Consensus Forecasts shows a softer growth outlook

    Source: New Zealand Institute of Economic Research
    Date Submitted: 24 Oct 2018
    Views: 27
    Downloads: 0
    NZIER's economic outlook for the next two years for household and government spending, investment in construction, export, labour market, inflation and interest rates.
  • Trade tensions will hurt all stock markets

    Source: Jodie Gunzberg
    Date Submitted: 04 Nov 2018
    Views: 1192
    Downloads: 0
    The International Monetary Fund (IMF) recently released the October 2018 World Economic Outlook, which estimated the impact of global trade tensions on GDP. Overall, the IMF states that the tariffs already in place will hurt GDP and that additional tariffs will weaken it further.
  • Uzbekistan: The som has been stable so far but how long can it last?

    Source: Firdavs Olimov, CFA, Kenneth Lai Kar Mun, CFA, Shawn Abdurakhimov , Hasan Khudoyorov
    Date Submitted: 18 Oct 2018
    Views: 43
    Downloads: 1
    Since one-off devaluation of the Uzbekistani som to 8,100 UZS/USD from 4,210 on 5 September 2017, the currency has been quite stable thanks to growing exports, increasing foreign investments, loans from international financial institutions (EBRD, ADB, etc.), decreasing use of US dollar within Uzbekistan, and a small intervention from Central Bank of Uzbekistan (CBU).
  • “Counter-cyclical” adjustment factor resumed to anchor Chinese currency

    Source: Jack Jiang
    Date Submitted: 02 Oct 2018
    Views: 45
    Downloads: 0
    The People’s Bank of China (PBOC) announced on August 24 that China’s CNY fixing reporting banks have resumed the counter-cyclical adjustment (CCA) factor in the CNY official midpoint this month. 
  • Learning and the capital age premium

    Source: Kai Li, Chi-Yang Tsou, Chenjie Xu
    Date Submitted: 04 Oct 2018
    Views: 37
    Downloads: 5

    Does capital age of a firm affect its ability to affect capital efficiently? Are old-capital firms more exposed to aggregate productivity shocks? Do they earn higher expected returns? How does their cash-flow duration compare to that of young-capital firms? The authors study the effect of firms' knowledge about their exposure on their financial performance. 

  • Despite US Tariffs, China's Deleveraging Will Continue

    Source: Paul Hsiao,Andy Suen
    Date Submitted: 23 Sep 2018
    Views: 44573
    Downloads: 0

    Look for China’s deleveraging campaign to continue, albeit at a less vigorous pace, despite this year’s slower-than-expected growth and trade headwinds.

    To be sure, the latest round of US tariffs on $200 billion worth of Chinese goods is not welcome. It is the largest and broadest increase yet, and it will be imposed on more consumer-facing products such as electronics, household items, and food than previous tariffs were. This round will start with a 10% rate that may increase to 25% in January. Next could be an additional tariff round on $276 billion of products covering virtually all other Chinese goods imported by the US that have not yet been affected. We estimate that the real GDP drag due to US-imposed tariffs (including the proposed 10% implementation on $200 billion of exports) will be about 40 basis points, with most of the adverse effects being felt next year. If the US implements the 25% tariff rate in 2019, the drag on growth could intensify.

  • Catch-up cycle: a general equilibrium framework

    Source: Liu Peilin, Jia Shen, Xun Zhang
    Date Submitted: 07 Oct 2018
    Views: 21
    Downloads: 0
    Some latecomer economies, such as Japan, South Korea, Taiwan or Singapore have succeed in catching up with developed economies, while others have not. How can we describe the process of catching-up? Do policy choices dealing with different stages of economic catching-up differ? Liu and Jia analyze the common characteristics that the successful latecomer economies share and provide policy implications for those latecomer economies which have just begun to catch-up.
  • Impact of Fukushima nuclear disaster on oil-consuming sectors of Japan

    Source: Farhad Taghizadeh-Hesary, Naoyuki Yoshino, Ehsan Rasoulinezhad
    Date Submitted: 04 Oct 2018
    Views: 31
    Downloads: 0
    The Fukushima nuclear disaster in 2011 has caused Japan to shut down its nuclear power plants and become more dependent on imported fossil fuels. How did this transition affected the elasticity of oil consumption to crude oil price in Japan's various economic sectors? What does Japan need to do to raise its energy self-dependency and security?
  • East Asian integration towards an East Asian economic community

    Source: Christopher M. Dent
    Date Submitted: 04 Oct 2018
    Views: 44
    Downloads: 0
    East Asian efforts to build a regional economic community are occurring at multiple levels in various parts of the region, and regarding different sectors or issues. The process has already been well under way for some time now, albeit in a somewhat haphazard and mostly disjointed manner. Christopher M. Dent examines the key dimensions of East Asia’s integration, how they have developed over time, and what likely paths lie ahead in the endeavour to strengthen regional economic community-building.
  • Select Equity Opportunities for When the Trade Cloud Lifts

    Source: Anik Sen
    Date Submitted: 30 Aug 2018
    Views: 648
    Downloads: 0
    This year, equity markets in the US and emerging markets – notably Asia – have decoupled, with the S&P 500 making new record highs while the MSCI Emerging Markets Index dropped sharply. Expected earnings growth, meanwhile, is also rising in the US while falling in Asia.

    The big question is whether the weakening earnings growth outlook in Asia, now the single largest and fastest growing economic bloc, is a temporary issue or a sign of things to come for the global economy. If the main culprit is trade causing business sentiment to turn cautious, that means there is potential for spending to rebound when the trade issues are resolved. But if the main culprit is slowing demand – like what we’re seeing in many of China’s industries, including smartphone, auto, and home appliance – then earnings expectations in 2019 and beyond are too high.
  • Overview of Uzbekistan Automotive Sector 

    Source: Kenneth Lai, Veysal Usmanov, Shawn Abdurakhimov
    Date Submitted: 09 Sep 2018
    Views: 535
    Downloads: 24
    Including 85 member enterprises, UzAvroSanoat is the only producer of light and commercial vehicles in Uzbekistan. It has started 21 year ago since construction of the first automotive plant in Central Asia in Asaka, Andijan region. In 2004, "Uzavtosanoat" Association was transformed into Joint-Stock Company with the aim of production management efficiency growth.
  • The Trade Tension Timeline: Is the Worst Yet to Come?

    Source: Paul Hsiao
    Date Submitted: 28 Aug 2018
    Views: 1863
    Downloads: 0

     

    US tariffs on an additional US$16 billion of Chinese goods just went into effect, completing the $50 billion of tariffs announced in April. The tariffs focus on industrial machinery and avoid many consumer-grade products like computers, smartphones, and apparel. China has reciprocated in kind with tariffs on $16 billion worth of US imports including fuel, autos, and steel products. So what’s next? We see three key events worth watching for the rest of the year:

     

     

  • Public Financial Management Systems—Bangladesh: Key Elements from a Financial Management Perspective

    Source:
    Date Submitted: 13 Aug 2018
    Views: 103
    Downloads: 0
    The Bangladesh Public Financial Management Systems report documents the country’s financial management systems covering primarily the areas of budgeting, funds flow, accounting and reporting, and auditing systems. This report also provides insights into the quality of internal control systems, staffing resource capacity, and information technology structure. The intent is to provide project teams and consultants with a better understanding of financial management systems to improve the quality of financial management assessments during project preparation. Find out how high-quality financial management assessments support projects by identifying key risks and enabling the implementation of appropriate actions and reforms to mitigate those risks.
  • Piloting Results-Based Lending for Programs: Proposed Increase in Resource Allocation Ceiling

    Source:
    Date Submitted: 13 Aug 2018
    Views: 27
    Downloads: 0
    ADB introduced results-based lending (RBL) for programs in June 2013. RBL was conceived and developed in the context of broader efforts by the international development community to expand the use of results-based financing modalities. It aims to strengthen incentive and accountability for results in development assistance operations by linking loan disbursements with results. Multilateral development banks (MDBs) and other agencies have been utilizing elements of results-based financing since the late 1990s through such mechanisms as cash on delivery aid, conditional cash transfers, output-based aid, and performance-based contracts. ADB’s Third Primary Education Development Project in Bangladesh approved in July 2011 used a sector-wide approach with ADB financing linked to clearly defined indicators and relying on the government’s treasury system for financial management. The World Bank introduced the program-for-results (PforR) financing instrument in January 2012. ADB built on these discussions in developing its version of results-based financing, RBL. Based on the policy paper entitled Piloting Results-Based Lending for Programs (RBL policy), ADB introduced this new modality on a pilot basis, from 6 June 2013 to 5 June 2019.
  • Public Financial Management Systems—Indonesia: Key Elements from a Financial Management Perspective

    Source:
    Date Submitted: 13 Aug 2018
    Views: 92
    Downloads: 0
    Foreign aid to Indonesia takes the form of loans or grants. The loans can be made either to the government or to state-owned enterprises with a guarantee from the government. This report documents Indonesia’s financial management systems covering budgeting, funds flow monitoring and analysis, accounting and reporting, and auditing. It also provides insights into the quality of internal control systems, staff capacity, and information technology structure. The intent is to provide project teams and consultants with a better understanding of financial management systems during project preparation. Find out how high-quality financial management assessments support project implementation through the identification of key risks and enabling the implementation of mitigating actions and reforms.
  • Greater Mekong Subregion: Overview of the Regional Investment Framework 2022

    Source: ADBI
    Date Submitted: 26 Aug 2018
    Views: 60
    Downloads: 0
    The Regional Investment Framework 2022 (RIF 2022) is the medium-term pipeline of priority projects in the Greater Mekong Subregion (GMS). It is a consolidation and expansion of the earlier RIF 2013–2022, and continues to operationalize the strategic priorities of the GMS Program under the GMS Strategic Framework 2012–2022 and the Ha Noi Action Plan 2018–2022.

    The RIF 2022 covers a wide range of sectors including transport, energy, environment, agriculture, health and human resource development, information and communication technology, tourism, transport and trade facilitation, and urban development.

    This pipeline is intended to be used as an instrument to have greater alignment between regional and national planning for GMS projects and as a tool to galvanize new financing for projects.
  • Greater Mekong Subregion Economic Cooperation Program: Annex to the Regional Investment Framework 2022: Project Pipeline

    Source:
    Date Submitted: 13 Aug 2018
    Views: 7
    Downloads: 0
    The Regional Investment Framework 2022 (RIF 2022) is the medium term pipeline of priority projects in the Greater Mekong Subregion (GMS). It is a consolidation and expansion of the earlier Regional Investment Framework (2013-2022) and continues to operationalize the strategic priorities of the GMS Program under the GMS Strategic Framework (2012-2022) and the Hanoi Action Plan 2018-2022 (HAP). The RIF 2022 covers a wide range of sectors including transport, energy, environment, agriculture, health and human resource development, information and communication technology, tourism, transport and trade facilitation, and urban development. This pipeline is intended to be used as an instrument to have greater alignment between regional and national planning for GMS projects and as a tool to galvanize new financing for projects.
  • Results Framework Indicator Definitions

    Source:
    Date Submitted: 13 Aug 2018
    Views: 0
    Downloads: 0
    This document provides definitions and data compilation methodologies for the Asian Development Bank (ADB) results framework indicators listed in ADB’s Transitional Results Framework, 2017–2020. Definitions of standard explanatory data indicators are included in a separate note. This guidance is for internal use by ADB staff. It will be updated as necessary to reflect good practices and lessons learned.
  • Solutions for Agricultural Transformation Insights on Knowledge-Intensive Agriculture

    Source: Asian Development Bank
    Date Submitted: 26 Aug 2018
    Views: 67
    Downloads: 0
    As of 2015, the number of hungry people still reached 777 million. Similarly, the Millennium Development Goals aimed to halve the proportion of hungry people, from 23.2% in 1990-1992 to 11.6% by 2015. Agriculture is now at a crossroad. Its resource base is shrinking, and the productivity of the resource is declining. Existing agricultural production systems with heavy dependence on different inputs have become increasingly untenable. Fortunately, technological innovations and improvements create opportunities for a paradigm shift from labor and resource-intensive to knowledge-intensive agriculture. In a workshop organized by the Asian Development Bank, stakeholders exchanged experiences and ideas on how to design and implement measures to build a knowledge-intensive agriculture. This report summarizes the key messages from the workshop.
  • Strategy 2030: Achieving a Prosperous, Inclusive, Resilient, and Sustainable Asia and the Pacific

    Source: Asian Development Bank
    Date Submitted: 26 Aug 2018
    Views: 460
    Downloads: 0
    Asia and the Pacific has made great strides in poverty reduction and economic growth in the past 50 years. It aspires to make even greater leaps going forward. The Asian Development Bank (ADB) has been a key partner in the significant transformation of the region and is committed to continue serving the region in the next phase of its development. The new long-term corporate strategy to 2030—Strategy 2030—aims to set the course for ADB’s efforts to respond effectively to the region’s changing needs. It builds on various assessments of ADB performance, including the Midterm Review of Strategy 2020, development effectiveness reviews (DEfRs), and studies by the Independent Evaluation Department (IED).
  • Instability in the Pacific Islands: A status report

    Source: Stewart Firth
    Date Submitted: 02 Sep 2018
    Views: 38
    Downloads: 0
    The Pacific Islands are highly diverse in political status, population, development, migration prospects, and potential for instability. Resilience is most under challenge in western Melanesia: Papua New Guinea, Solomon Islands, and Vanuatu are states-in-formation characterised by extraordinary linguistic and group diversity giving rise to weak consciousness of nationhood. Fiji is different: a weak democracy but a strong state. Many observers see increasing tensions, disputes, and violence over land in Pacific urban areas as people’s traditional connections with rural villages diminish and landlessness becomes more common.
  • Getting Singapore in shape: Economic challenges and how to meet them

    Source: Manu Bhaskaran
    Date Submitted: 06 Sep 2018
    Views: 646
    Downloads: 0
    This Analysis assesses the two main adjustment mechanisms for dealing with such challenges: the government’s top-down policy interventions and the more spontaneous bottom-up adjustments by companies. It argues that Singapore’s economic model may not be evolving quickly enough to allow the country to adjust successfully to its domestic and external challenges. It also argues that bolder and more rigorous changes are needed in the policy sphere to overcome these challenges.
  • Tapping Technology to Maximize the Longevity Dividend in Asia

    Source: Asian Development Bank
    Date Submitted: 09 Oct 2018
    Views: 2192
    Downloads: 0
    This article qualifies for 1 CE under the guidelines of the CFA Institute Continuing Education Program. 
    We encourage CFA Institute members to login to the CE tracking tool to self-document these credits. 

    Asia is graying rapidly: its share of senior population aged 65 and over will double from 9.2% in 2020, to 18% in 2050. Some countries will experience a drastic reduction of its working-age population (ages 15-64), as well as aging of the current workforce. This report explores the role and potential of technology in addressing economic and labor market opportunities and challenges posed by aging. It shows how technology can harness gains from the longevity dividend and draws together national and regional policy recommendations for countries in Asia and the Pacific.
  • Land Acquisition and Infrastructure Development Through Land Trust Laws: A Policy Framework for Asia

    Source: Naoyuki Yoshino, Saumik Paul, Vengadeshvaran Sarma, Saloni Lakhia
    Date Submitted: 02 Sep 2018
    Views: 722
    Downloads: 0
    The “land question” has invigorated agrarian studies and economic history since Marx and early 20th century writers on agrarian questions. In countries that allow private land ownership, compulsory land acquisition is the right and action of the government to take property not owned by it for public use. In the long run, growth dividends from infrastructure development and industrialization are likely to be materialized, and acquisition of land to facilitate such process remains one of the main development challenges in many Asian countries. The recent political upheaval transgressing from the industrialization drive through forcible land-grab in many parts of Asia (India, Indonesia, Nepal, and the Philippines in particular) point to the need for a sustainable policy—a framework that results in a positive sum game, benefiting the landowners without hurting the growth prospects. Combining the tools from the fields of law and economics, we propose the land trust or land lease for the development of infrastructure investment and industrialization purposes. We argue that this is one of the best ways to increase the rate of return to invite private investors into infrastructure investment. Through evidence from the success stories of land trust initiatives in many Asian countries, including India, we aim to showcase the relevance of this alternate method.
  • An Overview of Islamic Banking and Finance in Asia

    Source: Akbar Komijani, Farhad Taghizadeh-Hesary
    Date Submitted: 05 Nov 2018
    Views: 1434
    Downloads: 0
    This article qualifies for 0.5 CE under the guidelines of the CFA Institute Continuing Education Program. 
    We encourage CFA Institute members to login to the CE tracking tool to self-document these credits. 

    The Islamic finance industry has grown substantially in Asia over the last 2 decades. The Muslim populations in different Asian countries, especially in Southeast Asia, are increasing. Rapid Muslim population growth and improving living standards may enhance the popularity of Islamic finance as a keen alternative to conventional financing mechanisms. In addition, investors from the Middle East and Asia are increasingly seeking to invest in products that are in line with their religious beliefs. The governments and financial authorities in several Asian countries have played active roles in promoting the development of Islamic financial markets in line with the efforts to boost investments and achieve sustainable funding to enhance economic growth by tapping the huge liquidity from oil- and commodity-producing countries. The ethical character and financial stability of Islamic financial products may increase their attraction. Islamic financial products have an ethical focus (notably excluding investment in alcohol and gambling) with a risk profile that appeals to wider ethically conscious investors. Given that in Islamic banking returns on investments are based on underlying economic activities and/or assets that structure the contractual relationship between transacting parties, it is possible to use the asset-based nature and risk-sharing aspects of Islamic finance for greater integration with the real economy and to improve the overall economic balance between the real and the finance sector.
  • Macro Disagreement and the Cross-Section of Stock Returns

    Source: Weikai Li
    Date Submitted: 11 Aug 2018
    Views: 37
    Downloads: 2
    This paper examines the effects of macro-level disagreement on the cross-section of stock
    returns. Using forecast dispersion measures from the Survey of Professional Forecasters
    database as proxies formacro disagreement, I find that high macro beta stocks earn lower
    future returns relative to lowmacro beta stocks following high macro disagreement states.
    This negative relation between returns for macro factors andmacro disagreement is robust
    and exists for a large set ofmacroeconomic factors, suggesting that highmacro beta stocks
    are overvalued compared with low macro beta stocks due to their greater sensitivity to
    aggregate disagreement.
  • Bangladesh BoP likely to turn into positive riding on fresh large Japanese FDI worth USD 1.48 bn

    Source: Md. Nazmus Sakib
    Date Submitted: 07 Aug 2018
    Views: 126
    Downloads: 19
    A landmark deal between Japan Tobacco Group and Akij Group will book single largest FDI in Bangladesh that is expected to lose some pressure on the Balance of Payments of Bangladesh. Japan Tobacco Inc. has acquired Akij Group’s tobacco business, United Dhaka Tobacco Company Limited with a record payment of USD 1,476 million, the biggest ever buyout involving a Bangladeshi company. With the completion of the transaction that is likely to occur in the Jul’18-Sep’18 period, Bangladesh will receive a FDI worth of USD 1,476 million.
  • Real Estate Opportunities In India

    Source: Charudath C R
    Date Submitted: 06 Aug 2018
    Views: 123
    Downloads: 0

    For centuries, going back to the days of Roman Emperor, India was the largest & richest economy in the world. In 1700 years India contributed ~25% of the global GDP, higher than the US accounts for world today. But in the course of 200 odd years of colonial empire / British exploitation reduced India to one of the poorest nation in the world by 1947, making India poster child in poverty, illiteracy & disease. Today as we speak, India is the 3rd largest economy in the world (in PPP terms). Since 1991 India managed CAGR 8.4% second only to China.

    What makes India such a vibrant economy – Indian demography.

    Indian population is at ~1.3bn. growing at 1.3% YOY. It is estimated to be 1.7bn later in this century. Life expectancy is 69years (27years when British left us), literacy rate today is at 79% (17% when British left). GDP at nominal price is US $2.25tn growing this year @6.7% (In PPP terms US $7.5tn+, larger than Japan).

    Gross Debt to GDP 69% compare to China 260%, Foreign exchange reserve US $405bn (as on July’18). India Gross Savings Rate @ 31%. Therefore, available investment resource is clear. It is estimated India will be US $10tn (nominal) economy by early 2030. Few interesting statistics, A billion mobile phones in India vs 350mn in the US. Same capacity of steel of US, 2.5 times of cement capacity of US.

    By 2020, Average age of the population

    1 Japan - 48

    2 Western Europe - 45

    3 China - 37

    4 India - 29

    5 US - 40

    The productive age 15yrs – 60yrs constitutes of 2/3rd of the Indian population by 2025. A study finds the Indian middle class population ~300mn is growing significantly and pushing consumption patterns up, and it is estimated the size of middle class population will reach 600mn by 2030 (twice the size of US population). We have 10mn people migrating every yr. from urban to cities.

    Indian Real estate market size estimated to be US $126bn and it is predicted to grow 7 times of current size in future. Real estate staring massive young population and economic development. Real estate sector is the second largest employer in the country. The housing sector contributes 5% to 6% to the Indian GDP and expected to almost double to more than 11% by 2025. Demand for Housing, Retail, Hospitality, Commercial (office) is growing. Entrepreneurship - India has made the world’s second largest start-up ecosystem second to US.

    India is the 4th largest FDI attracter in the world. The latest union budget allocates INR 60bn towards infrastructure development, which intern opens for other developments. Massive opportunities for Indian & foreign real estate players. Govt. ambitious target by 2022 housing for all requires construction of 20mn+ homes for economically weaker section, and this cannot be done by government alone, need private participation too.

    RERA a transparency non-negotiable act will protect the interest of customers. Bureaucracy is coming down (comparatively), single window clearance mechanism to speed up the process to ensure the project is off the ground ASAP.

    For Tier 1 cities in India (population >10mn), Global real estate transparency index moved up to 35 among 190 odd countries. Reforms such as GST, RERA, Benami act, clearly the regulatory changes enabling upward.

    Summary:

    1.      Demand for residentials will continue to grow, India accounts for 65% productive age

    2.      One survey found, out of 11,000 developers in India only 250 have complete depth & expertise. There are enough opportunities for overseas players

    3.      Besides Tier 1 cities, there are 65 Tier 2 cities in India (with >1.5mn population) attracting investments. 100 smart cities + rapid urbanisation will certainly open massive opportunities in Office, Retail, Industrial, Manufacturing, Hospitality, Tourism, Medical Tourism and many

    4.      Reforms are sustainable (though there are short term crisis) and enables growt

  • Wow Philippines

    Source: Ismael Pili
    Date Submitted: 06 Aug 2018
    Views: 94
    Downloads: 0
    • 'Wow Philippines' was an early tourism slogan for the Philippines.  In our view, the country's macro picture warrant some eye-catching features.   
    • A robust macro story.  The Philippines is forecasted to have one of the strongest GDP growth in Asia, with the ADB expecting 6.8% in 2018 and 6.9% in 2019.  The government has stated a target of 7% to 8% growth for 2018, with an intention to maintain growth at this level in subsequent years. 
    • A resilient domestic economy.   The Philippine economy continues to be fueled by the twin engines of Overseas Filipino Workers (OFW) remittance and Business Process Outsourcing (BPO).  Despite risk to growth for both factors, remittance and BPO revenues are expected to account for roughly 10% of GDP.  
    • A second leg to its growth is investments, which had historically lagged but now offers promise.  Infrastructure spending is trending higher.  A facet of the Philippine economy worth noting includes the strong provincial growth of the country.  
    • Macro concerns doesn't derail the growth story.  Areas of macro concerns for the Philippines include its current account deficit and falling gross international reserves.  Inflation has been higher than expected, and the peso has been the weakest Asian currency against the USD this year.  Interest rates are on the rise as a result, and expected to trend higher.  Still, these factors will not derail the country's expected economic growth, which is slated to be one of the fastest in Asia.  
  • China’s Processing Trade and Value Chains

    Source: Lili Yan Ing, Wei Tian, Miaojie Yu
    Date Submitted: 06 Aug 2018
    Views: 689
    Downloads: 0
    We investigate how trade liberalisation affects the performance of Chinese manufacturing firms. To better understand China’s role in global value chains, we examine Chinese firms with a significant import share from Indonesia, one of its largest processing source countries. We find that Chinese firms with a greater import share from Indonesia perform better in productivity, export, and sales, and they are more likely to engage in processing exports. Moreover, the impact of foreign trade liberalisation on China’s export scope is more pronounced for firms with a larger import share from Indonesia because of their greater extent of engagement in global value chains.
  • The Eurasian Land Bridge: The Role of Service Providers in Linking the Regional Value Chains in East Asia and the European Union

    Source: Richard Pomfret
    Date Submitted: 06 Aug 2018
    Views: 55
    Downloads: 0
    Rail links between China and Europe are typically analysed in the context of China’s Belt and Road Initiative, focusing on China’s economic rise and the implications for international relations. This paper argues that establishment of the China–Europe Land Bridge predated the Belt and Road Initiative and has been market-driven, as service providers identified and responded to demand for efficient freight services along preexisting railway lines. Governments’ role was trade facilitating, i.e. reducing delays and costs at border crossing points, rather than investing in hard infrastructure. Service Providers responded by linking European and Asian value chains (e.g. in automobiles and electronic goods) and reducing costs for traders shipping between China and Europe. The Eurasian Land Bridge provides a case study of ‘servicification’ as a component of increased trade in the 21st century.
  • Banking system news in Mongolia - Banking Competition Review: 2018 Q1

    Source: Economic Policy and Competitiveness Research Center
    Date Submitted: 11 Aug 2018
    Views: 0
    Downloads: 0
    Quarterly macroeconomic overview of Mongolia's banking system using charts and graphs produced by the Economic Policy and Competitiveness Research Center.

     
  • Adjustment to Trade Opening: The Case of Labor Share in India's Manufacturing Industry

    Source: Prachi Gupta, Matthias Helble
    Date Submitted: 06 Aug 2018
    Views: 3
    Downloads: 0
    The objective of this paper is to study how manufacturing plants in India adjusted to trade liberalization during the period 1998–99 to 2007–08. We estimate how the labor share changed due to tariff reduction. Our results indicate that a decline in output tariffs led to an increase in the labor share of income. In contrast, a fall in input tariffs led to a decrease in the labor share. Controlling for factor intensity, we find that in technology intensive and human capital resource intensive sectors, both a decline in input and output tariff rates led to a decline in labor share. A fall in tariffs only led to an increase in labor share for labor intensive and low-technology plants. Hence, India’s bias towards capital and technology intensive production explains the overall decline in labor share in the post reform period. Furthermore, the empirical results show that labor adjustment occurred more efficiently in Indian states with flexible labor laws.
  • Monthly Macroeconomic Overview of Mongolia: April 2018

    Source: Economic Policy and Competitiveness Research Center
    Date Submitted: 11 Aug 2018
    Views: 55
    Downloads: 0
    Monthly macroeconomic overview of Mongolia using charts and graphs produced by the Economic Policy and Competitiveness Research Center.
  • Financial Inclusion, Financial Literacy, and Financial Education in Georgia

    Source: Yaroslava Babych, Maya Grigolia, Davit Keshelava
    Date Submitted: 11 Aug 2018
    Views: 15
    Downloads: 0
    In this paper, we provide a comprehensive overview of the current state of financial inclusion and financial literacy in Georgia based on the latest literature, statistical evidence, and recent surveys. The paper reviews current government policy initiatives and strategy documents aimed at improving financial access of SMEs and households; analyzes the state of the regulatory framework in Georgia; focuses on the causes behind the current low levels of financial inclusion and financial literacy among the young, the poor, and the rural population; and provides policy recommendations to comprehensively address the financial inclusion problem in Georgia.
  • International Outsourcing, Environmental Costs, and Welfare

    Source: Jai-Young Choi, Eden S. H. Yu
    Date Submitted: 11 Aug 2018
    Views: 35
    Downloads: 0
    This paper explores the welfare consequences of international outsourcing in the presence of resulting environmental damage in a three-stage model of North–South trade. In stage 1, outsourcing firms in the North (e.g., United States [US] and Europe)cause environmental damage to the vendor country in the South, as exemplified by the People’s Republic of China (PRC). But, as its primary goal, the South pursuing economic development is willing to bear the costs of environmental degradation. Moving into Stage II, the environmental deterioration becomes so severe in the South that the vendor country begins to tackle the environmental problem by enacting government regulations. As a result, the costs and, hence, the prices of outsourced goods and services tend to increase for the firms in the North. However, the environmental protection measures undertaken generally fall short of the levels needed to restore the environmental quality acceptable by WHO standards. We present a framework for analyzing the effects of international outsourcing on environment and, ultimately, social welfare in terms of gains and losses under three alternative scenarios regarding no, partial or full accountability for outsourcing induced environmental damages. The policy implication is clear: to fully resolve the environmental problem in Stage III, the implementation of strong regulations or the fostering international cooperation is desirable; that is, until the environmental costs of outsourcing are fully accounted for by the outsourcing firms in the North. Such firms, however, may react by resorting to insourcing, diversified outsourcing and other strategies.
  • Financial Inclusion, Regulation, Financial Literacy, and Financial Education in Tajikistan

    Source: Roman Mogilevskii, Shokhboz Asadov
    Date Submitted: 11 Aug 2018
    Views: 9
    Downloads: 0
    This paper provides an analysis of financial inclusion, literacy, and education issues in the Republic of Tajikistan. It discusses the recent progress in financial inclusion and the sector’s response to the major external shock associated with the sharp fall in Tajik labor migrants’ remittances. The policies dealing with different aspects of financial inclusion are analyzed with a focus on the regulatory framework, penetration of new financial technologies, and the existing barriers to inclusion. The paper provides a set of recommendations for improving the situation with financial inclusion and financial literacy in the country.
  • Dismissal Laws, Innovation, and Economic Growth

    Source: Krishnamurthy V. Subramanian
    Date Submitted: 11 Aug 2018
    Views: 64
    Downloads: 0
    I theoretically and empirically show that dismissal laws laws that impose hurdles on fi ring of employees spur innovation and thereby economic growth. Theoretically, dismissal laws make it costly for fi rms to arbitrarily discharge employees. This enables fi rms to commit to not punish short-run failures of employees. Because innovation is inherently risky and employment contracts are incomplete, dismissal laws enable such commitment. Speci cally, absent such laws, firms cannot contractually commit so ex-ante. The commitment provided by dismissal laws encourages employees to exert greater effort in risky, but path-breaking, projects thereby fostering fi rm-level innovation. I provide empirical evidence supporting this thesis using the discontinuity provided by the passage of the federal Worker Adjustment and Retraining Noti cation Act. Using the fact that this Act only applied to firms with 100 or more employees, I undertake difference-in-difference and regression discontinuity tests to provide this evidence. Building on endogenous growth theory, which posits that economic growth stems from innovation, I also show that dismissal laws correlate positively with economic growth. However, other forms of labor laws correlate negatively with economic growth and swamp the positive effect of dismissal laws.
  • Impact Evaluation of Road Improvements and Rural Poverty—Baseline Survey in the Ningxia Liupanshan Area of the People’s Republic of China

    Source: Masahiro Nishimura, Niklas Sieber, Sangui Wang
    Date Submitted: 15 Aug 2018
    Views: 0
    Downloads: 0
    Rural road improvements indirectly benefit the poor by generating more income opportunities. The Asian Development Bank is financing a major road-improvement project in rural areas of the People’s Republic of China. In order to assess the impacts of improved rural transport, two surveys are needed: a baseline survey conducted before project implementation and an ex-post survey conducted after the project’s completion. The impacts can be discerned through a comparison of the surveys’ results. This paper describes the methodology, implementation, and results of the baseline survey.
  • Global Banking Network and Regional Financial Contagion

    Source: Cyn-Young Park, Kwanho Shin
    Date Submitted: 15 Aug 2018
    Views: 55
    Downloads: 0
    This paper investigates and tests the role of regional exposures in financial contagion from advanced to emerging market economies through the global banking network using data on cross-border bilateral bank claims and liability positions. Results indicate that direct exposures of a country’s own and the overall region’s banking sectors to crisis-affected countries are systematically related to bank capital outflows during the global financial crisis. A further analysis suggests more favorable behavior of the same region lender toward emerging economies during crisis.
  • Guidance for Investing in Digital Health

    Source: Peter Drury, Susann Roth, Tom Jones, Michael Stahl, Donna Medeiros
    Date Submitted: 16 Aug 2018
    Views: 1273
    Downloads: 0
    Digital technologies are increasingly underpinning almost all aspects of daily life, including health care. The overarching goal is to meet the Sustainable Development Goals, particularly universal health coverage, by investing in digital health. Health care systems have begun to embrace the transformative power of information and communication technology to spur better informed decisions by people and health workers in rural areas and hospitals. Many digital health solutions are already in place, and many are planned. This publication helps identify investments in knowledge, people, policies, and equipment that will maximize the impact of digital health. It presents a digital health impact framework to illustrate how to assess costs, benefits, and timescales; manage expectations; and ensure affordable strategies.
  • Tourism as a river of Growth in the Pacific; A Pathway to Growth and Prosperity for Pacific Island Countries

    Source: Hayden Everett, Dain Simpson, Scott Wayne
    Date Submitted: 16 Aug 2018
    Views: 58
    Downloads: 0
    Tourism in the Pacific is increasing and will be a key driver of economic growth in the coming decade. Yet despite more visitors to the Pacific, tourism growth is not inevitable for all countries in the region. This brief identifies the trends driving this increase. To secure and sustainably harness the benefits of this growth, this brief recommends that Pacific island countries create an enabling environment for tourism through interventions in four areas: tourism policy, strategy, and the regulatory environment; infrastructure; human resources; and product development and marketing.
  • Closing the Financing Gap in Asian Infrastructure

    Source: Sungsup Ra, Zhigang Li
    Date Submitted: 09 Oct 2018
    Views: 1751
    Downloads: 0
    This article qualifies for 0.75 CE under the guidelines of the CFA Institute Continuing Education Program. 
    We encourage CFA Institute members to login to the CE tracking tool to self-document these credits. 

    Infrastructure investment in Asia, both in economic and social infrastructure, faces a massive financing gap despite the region’s high savings. The cause of this gap is a capital flow paradox in which Asia’s outflow of portfolio funds far exceeds the inflow. To change this, three areas must be improved: innovative measures to mitigate constraints, preparation of bankable projects, and mitigation of risks. This study provides an overview of key issues in filling infrastructure financing gaps in Asia, and presents examples from actual investment projects to illustrate latest developments addressing some fundamental constraints.
  • Trade Costs, Time, and Supply Chain Reliability

    Source: Utsav Kumar, Ben Shepherd, Roselle Dime
    Date Submitted: 17 Aug 2018
    Views: 64
    Downloads: 0
    This paper uses measures of international transport time in median and standard deviation based on shipment-level data from the Universal Postal Union, to analyze the effect of time on trade costs. The results show that median shipping times increase trade costs by a substantial amount. The determinants of shipping times are also analyzed and find that geographical distance is the most reliable indicator of median time and uncertainty, with logistics performance also playing a role in determining shipment times.
  • Switzerland: Asian Development Bank Member Fact Sheet 2018

    Source: ADBI
    Date Submitted: 17 Aug 2018
    Views: 35
    Downloads: 0
    Switzerland has contributed $882.25 million in capital subscription as of 31 December 2017. It has contributed and committed $622.40 million to Special Funds since joining in 1967. Companies and consultants from Switzerland have since been awarded $678.89 million in procurement contracts on ADB-financed projects. In 2017, the lending volume was $18.72 billion (111 projects), with technical assistance at $200.53 million (246 projects) and grant-financed projects at $597.49 million (24 projects). In addition, $11.92 billion was generated in direct value-added cofinancing.
  • Global economic conditions survey: Q2, 2018

    Source: Narayanan Vaidyanathan
    Date Submitted: 10 Aug 2018
    Views: 142
    Downloads: 11
    Economic confidence dipped from its Q1 peak in the second quarter of 2018, although it remains high by recent standards.

    Price pressures have been building as the global economic recovery has continued, and increased costs remain respondents' main concern this quarter. In terms of how businesses are responding to the changing economic environment, 40% say they are laying off staff, while 32% say they are considering scaling back investment in capital projects.
  • Request for Comments - Industry Credit Guidelines: Chinese Homebuilders and Property Developers

    Source: Winnie Guo, Tony Tang
    Date Submitted: 05 Aug 2018
    Views: 479
    Downloads: 10

    HONG KONG, 3 August 2018. Pengyuan International (“PENGYUAN”) has today released its  Industry Credit Guidelines for the Chinese Homebuilders and Property Developers for public consultation.

     

    These criteria will be effective immediately on the date of final publication. We intend to complete a review of all affected ratings, if any, within the next six months. We expect no impacts on our current rating portfolio. We would appreciate comments on these draft criteria from investors and other market participants. The request-for-comment versions of these reports are available via the links below.

     

     

    Our Industry Credit Guidelines: Chinese Homebuilders and Property Developers describe our analytical approach to assessing the credit risks of companies that have more than 50% revenue generated from China homebuilder and property developer industry. These criteria are developed within the framework of PENGYUAN’s General Corporate Rating Criteria and are supplementary to our General Corporate Rating Criteria. In addition to the credit ratios that are used in the Corporate Rating Criteria, PENGYUAN considers specific credit factors that capture the risks from China homebuilder and property developer industry, which are assessed to derive a company’s indicative credit score. 

  • Request for Comments - Government-Related Entities Criteria

    Source: Stanley Tsai, CFA, Liang Zhong, Tony Tang
    Date Submitted: 05 Aug 2018
    Views: 630
    Downloads: 6

    HONG KONG, 3 August 2018. Pengyuan International (“PENGYUAN”) has today released its Government-Related Entities (GRE) Rating Criteria for public consultation.

     

    These criteria will be effective immediately on the date of final publication. We intend to complete a review of all affected ratings, if any, within the next six months. We expect no impacts on our current rating portfolio. We would appreciate comments on these draft criteria from investors and other market participants. The request-for-comment versions of these reports are available via the links below.

     

    Our Government-Related Entities Rating Criteria set forth PENGYUAN’s approach to rating GREs in the corporate (including project finance), financial institution, insurance and public finance sectors globally. In our opinion, an issuer’s affiliation with the government may have a positive, negative or neutral impact on its overall creditworthiness. One of our primary considerations in analyzing a GRE is whether its credit profile may be enhanced by potential extraordinary support from the government in the event of financial distress, or conversely, impaired by potential extraordinary adverse interventions from the government should the government experience financial difficulties.

  • Bangladesh Strategy 2018 - A challenging year for equities

    Source: Asif Khan, CFA, Nasrin Akter Proma, Mustavi Zaman Khan
    Date Submitted: 06 Aug 2018
    Views: 2871
    Downloads: 179
    Bangladesh Strategy 2018 - A challenging year for equities
  • Monetary Policy Statement Review for H1 FY'19 

    Source: Md. Nazmus Sakib, Mohammad Rehan Kabir ,
    Date Submitted: 31 Jul 2018
    Views: 136
    Downloads: 14
    Monetary Policy Stance for H1 FY’19 is intended to foster price stability while fostering growth target of the government. Ahead of general election, policy rates were kept unchanged but BB may intervene with interest rate instruments like they did last fiscal year. 
  • India has lot to worry – My Take on Indian Economy

    Source: Charudath C R
    Date Submitted: 06 Aug 2018
    Views: 1439
    Downloads: 0

    During last one-year Brent Crude prices increased over 65%. Post US sanctions on Iran, state-of-affairs in India magnified. India being net oil importer, the bill has jumped over 25% in FY18, which is likely to continue in FY19 provided the price remains at the current levels but if the price increases from current levels, current account deficit (CAD) widens further, impacting fiscal spending. What does it mean for Indian economy? Funds earmarked for economic development will now be used for purchasing oil. In my view Government is unlikely to cut the excise duty on oil because every rupee cut means ~INR13,000crs loss to the government. Finance ministry did share India has accumulated unpaid oil bills worth INR 1.3lac crores b/w 2008-2014. Theoretically increase in CAD leads to depreciating currency, impacting fiscal spending, increase in headline inflation, increase in interest rate, fund outflow. Theory holds good at current scenario and we all witnessed rupee depreciating against major global currencies, RBI hiking Repo rate, raise in headline inflation & FIIs being net sellers in the market (post Fed hiking interest rate). Survey says every $10 pb raise in oil price result in 0.2 – 0.3 percentage reduction in GDP growth + increase in 1.7% WPI. In my view Inflation & MSP data will determine the RBI’s next move. Not to forget US trade war with major economies in the world and its challenges.

    Despite the positive momentum in global economy India could not participate (poor exports) due various structural reforms in the country. I am not sure how far the demonetisation helped but certainly Digital payment benefited on a larger scale. GST, RERA, IBC, Recapitalisation of Banks has brought confidence and/will certainly yield benefits on a longer tenure. However, present woes will continue till 2019 General election. Issues such as Low Capex growth will continue, Industries are reluctant to add or expand but discovering ways to utilise the existing capacities more efficiently and effectively.

    Growth has obviously done little to fire up the job market. About a million Indians reach the employment age every month. That is a daunting statistic. But the economy not been able to absorb more than 4mn of them in a year. Jobless growth has been the biggest threat to the economy and to the government.

    Various reforms have been taken in the respective sectors. Bhratamela is one of the largest initiative taken by Transport ministry, but the issue continues be on the land acquisition. Mumbai Delhi Industrial Corridor Plan, Smart cities, Bullet trains, Virgin Hyperloop Pune project, PMAY to promote housing for all, Agricultural reforms, irrigation projects, start-up promotion, International trade relations. Banking reforms starting with setting up of separate MPC, IBC & NCLT to clean up NPAs. >2000 cases registered with NCLT till date but only 1/3rd of them are addressed. Banks provision 50% post NPA, NCLT delay will impact the capital adequacy ratio of banks creating further imbalance in the economy.

    Conclusion -

    1.   Increase in Oil price will add fuel to the economic crisis

    2.   Economy with Jobless growth will not sustain. India “must do” lot more to create Job opportunities

    3.   Let us not forget ‘NPA’ a white Elephant in the room

    4.   Loan waiver is not a solution

    5.   Policies are framed keeping Geo political issues in mind

    6.   We have 29 states in India. Therefore, without support from each state double digit growth will remain a distant dream

  • The $200 Billion Question: Can China Retaliate Against the Latest US Tariff Threat?

    Source: Paul Hsiao
    Date Submitted: 25 Jul 2018
    Views: 2556
    Downloads: 0
    On 10 July 2018, the US announced a list of $200 billion worth of Chinese goods that are subject to a 10% tariff hike. As with the tariffs implemented earlier this month, the White House used Section 301 of the US Trade Act of 1974 as grounds for this latest action. While the $200 billion figure is nothing new – President Donald Trump made several references to this number in recent weeks – the timing gives this move a more aggressive tone. The US is still in the middle of implementing tariffs on the original $50 billion under Section 301. The first round of tariffs on $34 billion came into effect on 6 July, with the second round of $16 billion set to occur within the next few weeks. Further escalation was widely expected to take place after that second round.
    So far, China has matched the US with “dollar-for-dollar” tariffs. This time around, the amount of goods is likely too overwhelming for China to reciprocate in kind. For one, $200 billion exceeds the total value of goods China imported from the US last year (about $150 billion), notwithstanding the tariffs already put in place this year. So, while headlines may include tough talk from Chinese officials, a dollar-for-dollar tariff will be difficult, if not impossible, for them to implement.

     
  • Privatization in Uzbekistan

    Source: Kenneth Lai, , Veysal Usmanov, Shawn Abdurakhimov
    Date Submitted: 21 Jul 2018
    Views: 1932
    Downloads: 14
    In Uzbekistan, the important purpose of privatization is the attraction of foreign investments. The privatization improves modernization within the country. Moreover, technological advancement and re-equipment of the enterprises could also be accomplished due to privatization. Over the period of independence of the country, over 30 thousand state objects, including 6,500 large and medium-sized enterprises, were privatized. Today, the non-state sector accounts for more than 81% of gross domestic product, 94% of industrial production and more than 82% of the total employed population.
  • Overview of Uzbek Cement Sector

    Source: Kenneth Lai, Veysal Usmanov, Shawn Abdurakhimov
    Date Submitted: 21 Jul 2018
    Views: 657
    Downloads: 9
    Cement sector is concentrated with top 4 players producing 93% of the total cement (9.2 MT/year as of 2018) in Uzbekistan. Qizilqum Cement (3.6 mln MT/year as of 2017), Akhangarancement (owned by Russia's Eurocement; 2.2 mln MT/year as if 2017), Bekabad Cement (1.1 mln MT/year) and Almalyk (1.0 mln MT/year) are the top 4 cement companies in Uzbekistan. New entrants to the industry with smaller production capacity are Djizzakh Cement, Karakalpak (Titan) Cement and Turon Eco Cement. Very large portion of cement produced in the country serves the internal demand of Uzbekistan while small portion is exported to Central Asian countries and Afghanistan.
  • Roofs in Demand 

    Source: CAPER
    Date Submitted: 09 Jul 2018
    Views: 182
    Downloads: 3
    Key Points 
    ˖ President Xi Jinping’s advocacy of both housing purchase and rental in October last year has led to an investment boom in this sector –
    ˚ US$1.4 bn committed to 10 property rental platforms since May 2017
    ˚ capital deployments have been focused on China’s affluent cities – Tier 1 and New Tier 1 cities
    ˖ Soaring property prices and millennials’ quest for improved lifestyle have led to increased demand for rental apartments
    ˚ in 2016: the Rmb25,896 commanded per square metre in Tier 1 cities was six times that for 2002
  • The convexity of earnings yield: Does the dividend payout policy matter?

    Source: Boonlert Jitmaneeroj
    Date Submitted: 04 Jul 2018
    Views: 134
    Downloads: 14
    This paper uses a nonlinear model to examine the relationship between the earnings yield and the dividend payout ratio of international stock markets over the period 1995-2015. This paper produces new evidence indicating that the convexity of earnings yield has important implications for dividend policy decisions and equity investment choices. The increases in payout ratios have less influence on the earnings yield than the decreases in payout ratios. Furthermore, the earnings yields of firms with low payout ratios get larger effect from the changes in payout ratios than firms with high payout ratios.
  • Is Thailand’s credit default swap market linked to bond and stock markets? Evidence from the term structure of credit spreads

    Source: Boonlert Jitmaneeroj
    Date Submitted: 04 Jul 2018
    Views: 715
    Downloads: 21
    When the term structure of credit spreads is used in a panel vector autoregression model, Granger causality tests provide strong evidence of bi-directional relationships among CDS, bond and stock markets. This study argues that extant research using only a 5-year credit spread tends to understate intermarket linkages since in practice investors are able to trade credit risk over the entire term structure of credit spreads. Interestingly, this study produces new empirical evidence that the term structure of CDS-bond basis displays a monotonically increasing trajectory. As the maturity lengthens, the arbitrage opportunity of companies with negative (positive) CDS-bond basis decreases (increases).
  • Bangladesh National Budget Review 2018-19 (Update) 

    Source: Md. Nazmus Sakib, Mohammad Rehan Kabir
    Date Submitted: 28 Jun 2018
    Views: 158
    Downloads: 17
    Earlier on 7th June, 2018, we provided Bangladesh National Budget Review: FY’19 based on the budget proposal, placed by finance minister. The Parliament passed the final budget on 27th June, 2018 with some minor changes from the proposed one and this update depicts those changes in the Finance Bill- 2018 along with some observations. 
  • Mission Incomplete: Reflating Japan’s Economy

    Source: Sayuri Shirai
    Date Submitted: 10 Jul 2018
    Views: 765
    Downloads: 0
    Mission incomplete! This phrase neatly captures the progress made by the Bank of Japan (BOJ) in reflating the economy. In April 2013, under its new governor, the BOJ launched an unprecedented quantitative and qualitative monetary easing policy. Haruhiko Kuroda was certain that the 2% price stability target would be achieved within 2 years. About 4 years later, the BOJ lags behind other major central banks, with actual inflation and inflation expectations still well below 2%. What went wrong? And what should the BOJ do next? This former policy maker’s account expertly traces and analyzes the policy’s consequences.
  • Win - Win: How International Trade Can Help Meet the Sustainable Development Goals

    Source: Multiple, edited by Matthias Helble and Ben Shepherd
    Date Submitted: 01 Jul 2018
    Views: 84
    Downloads: 0
    The recently agreed Sustainable Development Goals (SDGs) are expected to guide development through the 2030 time horizon. The 17 SDGs cover many areas, such as poverty, health, sustainable development, and the environment. Given that trade is not an end in itself, there is no specific SDG goal for trade, but it is recognized as an important means of implementation. The objective of this book is to demonstrate to the international development community, including policy makers in developing countries, the contribution that international trade can make to achieving the SDGs. Economists have long argued that trade can promote income growth, which can then support sustainable development. But there are also more direct linkages between trade and sustainable development, for instance by affecting the price and availability of important goods and services for development, such as health and education. This book maps out a triple-win scenario when good trade policy spurs international trade, contributes to development-friendly outcomes, and supports the achievement of the SDGs.
  • A History of Financial Management at the Asian Development Bank: Engineering Financial Innovation and Impact on an Emerging Asia

    Source: Philip Erquiaga
    Date Submitted: 25 Jun 2018
    Views: 79
    Downloads: 0
    The Asian Development Bank (ADB) has evolved into a leading development banking institution in the global financial markets during the past half century since it was established. This publication—a good introduction to financial management practices in multilateral development banks—narrates the evolution of ADB’s financial policies, strategies, practices, and approaches by decade of operations. It shows how ADB swiftly responded to changing market conditions and provided funds to its developing members at the lowest possible cost. This publication explains how these practices and products played important roles in shaping ADB’s development mandate, fostered sustainable and steady growth, and paved the way toward an enviable AAA-rating in the capital markets.
  • Impact Evaluation of Development Interventions: A Practical Guide

    Source: Howard White, David A. Raitzer
    Date Submitted: 25 Jun 2018
    Views: 741
    Downloads: 0
    Impact evaluation is an empirical approach to estimating the causal effects of interventions, in terms of both magnitude and statistical significance. Expanded use of impact evaluation techniques is critical to rigorously derive knowledge from development operations and for development investments and policies to become more evidence-based and effective. To help backstop more use of impact evaluation approaches, this book introduces core concepts, methods, and considerations for planning, designing, managing, and implementing impact evaluation, supplemented by examples. The topics covered range from impact evaluation purposes to basic principles, specific methodologies, and guidance on field implementation. It has materials for a range of audiences, from those who are interested in understanding evidence on “what works” in development, to those who will contribute to expanding the evidence base as applied researchers.
  • Indonesia Enhancing Productivity through Quality Jobs

    Source: Emma Allen, Ruth Francisco, Edimon Ginting, Veto Tyas Indrio, Chris Manning, Joseph Marshan, Valerie Mercer-Blackman, Daryll L. Naval, Devanto Shasta Pratomo, Asep Suryahadi, Mohammad Zulfan Tadjoeddin, Kiyoshi Taniguchi
    Date Submitted: 10 Jul 2018
    Views: 674
    Downloads: 0
    The book focuses on Indonesia’s most pressing labor market challenges and associated policy options to achieve higher and more inclusive economic growth. The challenges consist of creating jobs for and the skills in a youthful and increasingly better educated workforce, and raising the productivity of less-educated workers to meet the demands of the digital age. The book deals with a range of interrelated topics—the changing supply and demand for labor in relation to the shift of workers out of agriculture; urbanization and the growth of megacities; raising the quality of schooling for new jobs in the digital economy; and labor market policies to improve both labor standards and productivity.
  • Social Protection for Informal Workers In Asia

    Source: Michael Samson, Kaleigh Kenny, Michael Cichon, David Cichon, Stephen Kidd, Verena Damerau, Babken Babajanian
    Date Submitted: 01 Jul 2018
    Views: 27
    Downloads: 0
    Asia’s growing labor force needs innovative solutions to reduce risks and ensure social protection of workers in vulnerable employment with informal arrangements. This book examines the need to expand social protection coverage of the informal sector to support working age productivity, reduce vulnerability, and improve economic opportunity. Case studies from Bangladesh, the People’s Republic of China, India, Indonesia, Pakistan, the Philippines, and Thailand o er suggestions to close social protection gaps and recommend policy solutions to create equitable and inclusive social protection programs for informal workers.
  • Key Indicators for Asia and the Pacific 2017

    Source: Multiple
    Date Submitted: 01 Jul 2018
    Views: 116
    Downloads: 0
    The Key Indicators for Asia and the Pacific 2017, the 48th edition of this series, includes the latest available economic, financial, social, and environmental indicators for the 48 regional members of the Asian Development Bank. It presents the latest key statistics on development issues concerning the economies of Asia and the Pacific to a wide audience, including policy makers, development practitioners, government officials, researchers, students, and the general public. Part I of this issue presents the current status of economies of Asia and the Pacific with respect to the Sustainable Development Goals based on selected indicators from the global indicator framework. This year’s report also discusses results from an initiative to facilitate the compilation of statistics on asset ownership from a gender perspective. Part II comprises statistical indicators that capture economic, financial, social, and environmental developments. Part III presents key statistics and stylized facts on the phenomenon of global value chains.
  • Challenges in Implementing Best Practices in Involuntary Resettlement: A Case Study in Sri Lanka

    Source: Jayantha Perera, Amarasena Gamaathige, Chamindra Weerackody
    Date Submitted: 01 Jul 2018
    Views: 38
    Downloads: 0
    Infrastructure projects sometimes physically displace households and disrupt income sources and livelihoods. The Asian Development Bank offers several good governance practices to its borrowers to minimize such adverse impacts, especially since the absorption of such best practices by countries is usually slow and erratic. This book presents an in-depth case study from a complex and sensitive infrastructure project in Sri Lanka, where international best practices in involuntary resettlement were successfully merged with local legal systems. The book demonstrates that the application of best practices to infrastructure projects needs continuous consultations with affected people and a firm commitment of resources.
  • Together We Deliver: 50 Stories of ADB's Partnership in Asia and the Pacific

    Source: Asian Development Bank
    Date Submitted: 16 Jul 2018
    Views: 60
    Downloads: 0
    This publication reflects on 5 decades of engagement with our 40 developing member countries, and explores 10 cross-cutting areas of work that enable the Asian Development Bank (ADB) to respond to new and emerging challenges that will affect development outcomes in a rapidly changing region. These 50 stories illustrate how ADB’s partnerships with government, civil society, the private sector, and other development partners have contributed to a momentous half century of development, helping to create the building blocks for the region’s prosperity.
  • Cross-Border Portfolio Investment and Financial Integration in Asia and the Pacific Region

    Source: Sayuri Shirai, Eric Alexander Sugandi
    Date Submitted: 01 Jul 2018
    Views: 1177
    Downloads: 0
    This paper examines the developments of cross-border portfolio assets and liabilities in the Asia and Pacific region over the periods of 2001–2017. Rapid increases in both portfolio foreign assets and liabilities have taken place particularly after the 2008–2009 global financial crisis. These cross-border portfolio investments have the following characteristics. First, equity has been a dominant source of foreign liabilities notwithstanding efforts to develop bond markets in the region. One exception is Australia, where foreign liabilities have been largely in the form of debt securities. Limited capital inflows to debt securities issued by emerging Asia may be attributable to the early stages of bond market development. Second, in contrast, debt securities have remained dominant as foreign assets held by the region. This mostly reflects Japan’s preference toward debt securities. Other Asia and Pacific economies have invested more heavily in foreign equity. Third, the region’s assets and liabilities linkages have remained overwhelmingly strengthened against the United States and Europe. Nonetheless, the post-crisis period has witnessed greater financial integration within the region. The intra-regional linkages have been deepest between Hong Kong, China and the People’s Republic of China (PRC), where the former has become a major financier of equity issued by the latter. Singapore increasingly plays a role as an equity investor toward the PRC, Japan, ROK, and other ASEAN economies. Albeit from the low level, the intra-ASEAN integration has been noticeable. Fourth, Japan with largest abundant domestic capital has remained predominantly exposed to the United States and Europe. Within the region, debt securities issued by Australia have increasingly attracted Japan’s capital. To conclude, intra-regional financial integration has risen at the center of the PRC with growing linkages with Hong Kong, China and Singapore.
  • Green Energy Finance in Australia and New Zealand

    Source: Ivan Diaz-Rainey, Greg Sise
    Date Submitted: 19 Nov 2018
    Views: 1751
    Downloads: 0
    We explore the history and current status of green energy finance in Australia and New Zealand. Although both countries have enviable renewable energy resources with a 100% renewable mix considered feasible, the two countries present highly contrasting contexts for energy finance. Currently, and largely for historical reasons, renewables make up over 80% of the electricity capacity in New Zealand, whereas in Australia this is 17%. Interestingly, between them and over time, the two countries have employed most of the important policy tools available to incentivize renewables and green energy finance (e.g., carbon taxes, carbon trading, a green investment bank, a green certification market, and feed-in-tariffs). Despite this, we show that between 2004 and 2017 both countries did not meet their potential in terms of renewables and have lower levels of green energy investment relative to GDP per capita than many other developed countries. The Australian and New Zealand context provides many lessons for other jurisdictions—ranging from the need for cross-party and regulatory commitment to energy transition, to the need for policy stability. Indeed, a key issue in Australia and New Zealand is the challenge of designing electricity markets that support energy transition and the investment that it requires. Incumbents in both jurisdictions are fearful of a “death spiral” induced by distributed power, and in Australia political instability and market design issues contributed to a major energy crisis in 2017. However, the crisis, the Paris Agreement and the associated impetus of new governments in both countries suggest green energy investment is set to increase in the coming years.
  • Financial Inclusion, Regulation, Financial Literacy, and Financial Education in Armenia

    Source: Armen Nurbekyan, Naneh Hovanessian
    Date Submitted: 16 Jul 2018
    Views: 16
    Downloads: 0
    Financial inclusion has significantly advanced in Armenia during the last decade. Rural and urban areas, however, have benefited unevenly. The high cost of providing financial services, the lack of physical infrastructure, higher poverty rates, and the low level of financial literacy are the main barriers to financial inclusion in the rural areas. The availability of, and the high level of trust in, postal services in all villages, along with innovative technologies, should be exploited to address the inadequate physical infrastructure. Insurance services, in particular health and agriculture insurance, have a high growth potential. Mandatory health insurance along with an e-health infrastructure can boost high-quality financial inclusion. Targeted financial education policies addressing the most vulnerable groups, in particular the rural population and the unemployed, will significantly increase the quality of financial inclusion. Addressing data gaps, especially in the SME sector, should be a priority for policy makers. Overall, a clear separation of strategies for financial inclusion from the National Strategy for Financial Education clarifying quantitative goals and policies will be beneficial.
  • Financial Inclusion, Financial Literacy, and Financial Education in Azerbaijan

    Source: Gubad Ibadoghlu
    Date Submitted: 24 Jul 2018
    Views: 20
    Downloads: 0
    This paper discusses the status of financial inclusion, education, and literacy in Azerbaijan as well as measures to foster the development of SMEs, which currently have inadequate access to financial resources. The primary policy challenge faced by the government of Azerbaijan is defining its role in creating broader access to financial products and services. This paper highlights the challenges faced in overcoming the barriers to financial inclusion, and solutions found, and discusses the main lessons learned and a potential way forward. The first section of the paper provides detailed information on the national financial system. The second section covers the status of financial inclusion for individuals and SMEs. The third section analyzes different (supply and demand) aspects of barriers to financial inclusion, while the remaining sections present policies aimed at promoting financial regulation, literacy, and education. Finally, the paper presents key policy recommendations.
  • Young Enterprises and Bank Credit Denials

    Source: Danilo V. Mascia
    Date Submitted: 25 Jun 2018
    Views: 60
    Downloads: 0
    By employing a sample of 20,956 observations of non-financial SMEs headquartered in the Euro area, between 2009 and 2015, we test whether young businesses are more likely to face credit rejections from lenders than their older peers. Our findings appear to confirm our suspicions that new enterprises consistently experience higher denials from banks compared to more established businesses. Such a result is stable to different model specifications and is also confirmed once we handle the issue of sample selection bias potentially affecting our data. Additional tests also reveal that credit constraints are particularly difficult for young SMEs located in Southern and Central Europe, as well as for those operating in the “Trade” industry. Overall, our evidence suggests that actions from the policy maker could be desirable to support the viability of credit and, thus, ensure the growth of young businesses in the Euro area.
  • Overview of Hong Kong Financial Services Industry

    Source: Financial Services Development Council (FSDC)
    Date Submitted: 12 Jun 2018
    Views: 1465
    Downloads: 106
    The Financial Services Development Council (FSDC) released an updated version of the “Overview of Hong Kong Financial Services Industry” in May 2018 which aims to facilitate industry practitioners and the wider public to understand and promote the strengths of Hong Kong as an international financial centre. The report covers the below sessions:

    Why Hong Kong?
    Being one of the world's most competitive and freest economy, Hong Kong possesses advantages like the strategic location and gateway to Mainland China, key conduit for investment and trade linked exchange rate system, bilingual legal system and simple tax regime, deep pool of talent and centre of expertise.

    Asset and Wealth Management 
    As the leading fund management centre in Asia Hong Kong has a diversified distribution of fund management and advisory business, an active ETF market and a sizable pension fund market. The soon-to-be-introduced open-ended fund companies structure will further promote Hong Kong as the Asian asset management centre for both conventional funds and PE funds.

    Banking
    Hong Kong has a robust banking industry by international standards and is regarded as the global offshore RMB hub. The Hong Kong Government is exploring with the Mainland authorities ways to open up more channels for two-way cross-border RMB fund flows.

    Capital Markets
    With HKEX being the leading stock exchange in fundraising (2015-2017) and diversified listed companies and investors, Hong Kong is looking to increase connectivity with Mainland investors and the Mainland market.

    Insurance
    Hong Kong ranks 1st in Asia in insurance density and 2nd in Asia in insurance penetration in 2016. Government has recently taken a number of initiatives to promote the insurance sector which includes the establishment of insurance authority, HK$100mn 3-year pilot programme for talent development and the adoption of FinTech on the development of personalized products.

    Fintech and Green Finance
    FinTech cooperation agreements signed with partners such as Australia, Dubai, Gibraltar, Singapore, Switzerland and the UK. On the other hand, HKMA, Cyberport in Hong Kong and the the Office of Financial Development Service of Shenzhen (OFDS) are exploring the feasibility of establishing cross-border soft-landing facilities in Shenzhen, encouraging Hong Kong FinTech firms to expand their businesses, and Mainland firms to establish themselves in Hong Kong.

    Professional Services & Financial Infrastructure
    Half of the Global 100 law firms and 1,400 regional headquarters of consultancy firms are set up in Hong Kong. With a well-established payment & settlement system and bilingual legal system, Hong Kong has the increasing prevalence of being the Alternative Dispute Resolution (ADR) forum. Meanwhile the Belt and Road Initiative will drive significant demand in Hong Kong’s world-class professional services.
     
  • Bangladesh National Budget Review 2018-19

    Source: EBL Securities Ltd. Research Team
    Date Submitted: 10 Jun 2018
    Views: 983
    Downloads: 42
    The 47th National Budget of Bangladesh and 12th by Finance Minister AMA Muhith has been proposed on 7th June, 2017. Proposed budget size for FY ’18 is BDT 4,645.7 bn which is 18.6% of GDP. This is the largest budget in the history of Bangladesh. Target Revenue is BDT 3,392.8 bn caused a deficit amounting to BDT 1,252.9 bn which will be financed through domestic sources (BDT 712.3 bn) and External Borrowings (BDT 540.7 bn).
  • Maldives: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 0
    Downloads: 0
    Comprising around 1,190 small islands in the Indian Ocean, Maldives is home to around 400,000 people, and is famous for some of the world’s most beautiful beaches. High-end tourism has propelled the economy’s strong expansion over recent decades. This has helped Maldives gain middleincome status, with the highest per capita income in South Asia. However, as a relatively small island economy, the country is extremely vulnerable to external economic shocks and the negative impacts of climate change. The Asian Development Bank (ADB) has been supporting the Government of Maldives since 1978. It has approved 22 loans ($158.38 million) and 7 grant ($90.14 million) for Maldives, and has funded 68 technical assistance projects totalling $30.25 million.
  • Mongolia: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 0
    Downloads: 0
    In 2017, Mongolia started to recover from its recent economic stagnation, with increases to commodity prices and higher foreign direct investment in mining as the main drivers of growth. However, the downturn of recent years has left significant economic challenges for the country, including debt accumulation, banking sector vulnerabilities, and rising poverty. Strengthening social protection and diversifying the economy are essential to ensure sustainable and inclusive economic growth with associated poverty reduction. The Asian Development Bank (ADB) has been Mongolia’s largest multilateral development partner since 1991, playing a central role in the country’s transformation to a middle-income, market-based economy. ADB has approved sovereign loans totaling $1.95 billion, grants totaling $237.21 million, and technical assistance projects worth $149.4 million for Mongolia. From 2007 to 2017, ADB committed a total of $90 million for nonsovereign loans.
  • Malaysia: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 326
    Downloads: 0
    Malaysia has transformed itself from a nation reliant on natural resources into a middle-income country in which services account for half of total output. This development success was refl ected in Malaysia ranking 37th of 127 countries on the Global Innovation Index 2017. While the country has experienced some economic slowdown over the past few years, its economy recovered faster than expected in 2017, with growth driven by strong global and domestic demand. For an economy that is dependent on external factors, macroeconomic stability is crucial to Malaysia’s sustained growth. The Government of Malaysia is continuing eff orts to boost domestic demand and reduce the country’s dependence on exports, with a pipeline of large infrastructure projects expected to stimulate both public and private investment.
  • Myanmar: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 67
    Downloads: 0
    Emerging from decades of economic and political isolation, Myanmar is enjoying a period of exceptional growth and is one of the fastest-growing economies in Southeast Asia. The country possesses abundant natural resources, a strategic location at the crossroads of Asia, a young population, and a sizable market with wide-ranging investment opportunities. The country, however, needs to achieve and maintain stability, both on the macroeconomic front and in terms of peace and reconciliation. It needs to address substantive deficits in infrastructure and human resources, which constrain social and economic development. Myanmar also needs to sustain its reform momentum toward good governance, effective public sector management, and a conducive business environment.
  • Nauru: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 0
    Downloads: 0
    Nauru is the world’s smallest island nation and one of the most remote countries on earth. In recent years, its economy has benefited from the presence of a regional processing center for asylum seekers, strong revenues from fishing licenses, and the liquidation of the Nauru Phosphate Royalties Trust. Economic and fiscal sustainability, however, remain key concerns for the Government of Nauru. The country relies on narrow and uncertain sources of revenue, with limited private sector opportunities. Education outcomes in Nauru are improving, but are still poor by international standards, while rates of noncommunicable diseases are among the highest in the world.
  • Nepal: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 15
    Downloads: 0
    Nepal has made notable socioeconomic progress in recent years: literacy rates have increased, poverty rates have declined, and gender disparities have narrowed. Nepal now strives to graduate to lower middle-income country status and achieve the Sustainable Development Goals by 2030. In 2017, local government elections and the fi rst-ever elections to state assemblies and the Federal Parliament marked crucial steps for the country in its transition towards federalism, as enshrined in the 2015 Constitution.
  • New Zealand: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 0
    Downloads: 0
    New Zealand has contributed $2.32 billion in capital subscription as of 31 December 2017. It has contributed and committed $196.30 million to Special Funds since joining in 1966. Companies and consultants from New Zealand have since been awarded $589.67 million in procurement contracts on ADB-financed projects.
  • Palau: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 0
    Downloads: 0
    Drawing on Palau’s exceptional natural and cultural resources, tourism generally underpins the country’s economic performance. A recent downturn in economic activity, however, illustrates that Palau remains vulnerable to external economic shocks, the impacts of climate change, and other environmental and weather-related risks. Reforms to improve and simplify Palau’s business regulations should make it easier to promote private sector development, but slow progress on important tax reforms has limited the prospects for creating the conditions necessary for more inclusive development.
  • Pakistan: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 693
    Downloads: 0
    Pakistan was a founding member of the Asian Development Bank (ADB) in 1966. The government has since worked with ADB to strengthen the country’s key infrastructure, social services, and economic growth. ADB has approved $32.1 billion in project assistance for Pakistan. Under the country partnership strategy, 2015–2019 and the country operations business plan, 2018 -2020, ADB is committed to ensuring high, sustained, and inclusive growth for Pakistan. The new business plan shows that the country’s sovereign operations will be increased signifi cantly to $7.1 billion over the next 3 years. Along with its continued focus on energy, infrastructure, and institutional reforms, ADB will reengage in education and health.
  • Papua New Guinea: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 0
    Downloads: 0
    The economy of Papua New Guinea (PNG) is dominated by labor-intensive agriculture and capital-intensive extraction of oil and gas, gold, copper, and silver. Mining and petrochemicals now account for over 25% of PNG’s gross domestic product and over 80% of its exports. The country continues to face significant challenges in making economic growth more inclusive and sustainable. Many areas of service delivery—such as health, education, transport, energy, and water—remain weak, particularly in rural areas.
  • Philippines: Asian Development Bank Member Fact Sheet 2017

    Source:
    Date Submitted: 15 Apr 2018
    Views: 105
    Downloads: 0
    The Philippines is one of Southeast Asia’s recent economic success stories, with strong growth accompanied by moderate infl ation, sound fiscal performance, and a strong external payments position. The country’s gross domestic product grew by an average of 6.4% a year during 2010–2017, compared with average annual growth of about 5% over the previous decade. The Government of the Philippines aims to lay a foundation for sustained strong and inclusive growth, a hightrust society, and a globally competitive knowledge economy. Among the economic priorities identifi ed by the current administration, which took office in June 2016, are addressing underinvestment in infrastructure and reducing income inequality and regional growth disparities.
  • Requests for Comments: Chinese Local Government Rating Criteria

    Source: Liang Zhong
    Date Submitted: 24 May 2018
    Views: 128
    Downloads: 8

    HONG KONG, 23 May 2018. Pengyuan International has today released its Chinese Local Government Rating Criteria for public consultation. These criteria will be effective immediately on the date of final publication, and we intend to complete the review of all affected ratings, if any, within six months thereafter. We expect no impact on our current rating portfolio.

    We would appreciate comments on these draft criteria from investors and other market participants. The request-for-comment version of the Criteria and analyst contact details are available via the following link:

    Chinese Local Government Rating Criteria: http://www.pyrating.com/Methodology/Index/10008.html

    Our Chinese Local Government Rating Criteria describe our top-down approach to assessing the credit risks of all local governments (LGs) and assigning issuer credit ratings (ICRs) and issuance credit ratings to LGs in China. We explain how we assess the key rating factors (namely a LG’s economic strength, budgetary strength, debt burden, liquidity, and governance and financial management) that together drive a LG’s relative credit strength compared to peer LGs reporting directly to the same higher-level government. We combine the relative strength score of the LG with the rating on its higher-level government and our other analytical considerations to determine ICR on the LG. 

     

     

    ANALYST CONTACTS MEDIA CONTACT OTHER ENQUIRIES
    Chief Analytics Officer
    Tony Tang

    tony.tang@pyrating.com
    +852 3615 8278
    media@pyrating.com contact@pyrating.com

    Sovereign and Public Finance
    Liang Zhong
    liang.zhong@pyrating.com
    +852 3615 8341

     
  • Overview of Power Energy sector of Uzbekistan

    Source: Kenneth Lai , Veysal Usmanov, Shawn Abdurakhimov
    Date Submitted: 21 Jul 2018
    Views: 168
    Downloads: 9
    Due to the growing demand for power energy driven by economic growth in the country, Uzbekistan is set to reform power energy sector. Uzbekistan is the largest electricity producer in Central Asia with total installed capacity of c.14.6GW, as of 2017. There are 45 power plants (16 by UzbekEnergo – state-owned power energy company). UzbekEnergo generates up to 90% of the power energy while the rest is produced by autonomous thermal power stations of the industrial enterprises and small hydroelectric power stations of the Ministry of Agriculture and Water Resources. The electricity is transmitted and distributed via power transmission lines (with 0.4 - 500 kV voltage ranges) whose total length currently exceeds 243,000 km.

    Power generation sources are largely focused on thermal power (natural gas, coal, etc.) while renewable energy makes a small portion of the capacity. Uzbek government plans to increase the share of renewable energy to 19% by 2025E from 13% currently. 

    Hydropower is the only main source among renewable energy sources while solar power contributes very small amount to the overall power generation. By 2025E, it is planned to achieve more power generation from solar and wind energy. Renewable energy has significant growth potential in Uzbekistan. According to Asian Development Bank (ADB), the country has 18 GW hydropower potential but only 1.8 GW has been developed so far. Solar power also has a great potential thanks to the favorable weather conditions in Uzbekistan. Uzbekistan gets between 2,410 and 3,090 hours of sunshine every year according to UN studies and the ADB estimates that about 3.8 million hectares of land in Uzbekistan meet the basic technical requirement for hosting solar energy facilities. 
  • China in Brief: Some Debts Good, Some Debts Bad

    Source: Sandra Chow, CFA, Ang Ben You, Cheong Yin Chin, CFA
    Date Submitted: 07 May 2018
    Views: 235
    Downloads: 0
    • Chinese banks and corporates have now released their full FY17 financial statements, following preliminary results in March.  The reports revealed how China's clampdown on leverage is starting to affect individual issuers in different ways.
    • Chinese banks' FY17 operating metrics showed the larger banks (the big six and larger joint stock banks) emerging stronger than the smaller banks from the government's deleveraging campaign, in terms of profitability and asset quality.   Because larger banks have been net interbank lenders, profitability has benefited from higher interbank rates. Asset quality also showed positive trends with special mention loan ratios falling and NPL (non-performing loan) classification actually becoming more conservative. On the other hand, the weaker joint stock and city commercial banks have seen profitability take a hit due to more expensive interbank funding costs. Their deteriorating asset quality shows them as being disproportionately affected by China's deleveraging campaign. 
    • Asset growth showed broad moderation at the banks in FY17, though growth rates were still higher at the smaller ones. The big six banks reported broadly lower asset growth rates compared to FY16. This trend can be extrapolated to the joint stock and city commercial banks, though here the picture was more mixed, with a few still seeing expansion. Slower asset growth was driven mainly by investment receivables, which fell as a % of assets at many banks. Banks' exposure to shadow loans should continue to shrink this year given the emphasis on fighting financial risks; we expect more regulations targeted at these items. 
    • Chinese real estate firms' liquidity weakened during FY17, despite robust contracted sales.  Slower mortgage approvals amid China's credit tightening delayed the companies' cash collections.  Undeterred, the developers continued heavy land acquisitions and most surpassed their FY17 land purchase budgets. All of the developers we cover aside from Greenland Hong Kong posted negative free cash flow last year. We see more bond supply risk from the China property sector as the developers plug their funding gaps with fresh onshore and offshore debt. The authorities do not seem to be clamping down heavily on developers' funding sources: onshore bond issuance among the Chinese high yield developers we track soared by 76% up to 20 April this year, compared to the same period in 2017. Offshore bond issuance has also remained steady, although rising risk aversion among $ bond investors is crimping appetite for Chinese property bonds and prompting more issuance of short-dated paper.
    • The Chinese industrial companies we track posted solid FY17 results overall, with companies ranging from car maker Geely Auto, piped gas provider China Oil & Gas and infant formula provider Health & Happiness reporting improving operations and stable or stronger credit metrics. With more prudent capex plans than the property developers, funding needs are generally lower. But regulatory approval for bond issuance seems to be on a case-by-case basis and issuers from overcapacity industries may find it harder to gain approval. Aluminium producer China Hongqiao, for instance, issued a 363-day bond in April, suggesting that investors were taking a cautious view of Hongqiao's long-term credit outlook, or that the company struggled to obtain an issuance quota from China's National Development and Reform Commission (deals of under 1 year maturity are not subject to NDRC approval). Yet the authorities are also supporting new funding channels selectively, presumably to ease the impact of credit tightening. West China Cement reported that it enjoys tax-free income from its new finance lease business, for instance.
    • We expect China will continue to tweak credit restrictions selectively, in order to rein in excessive leverage without causing a credit crunch.  Regulatory approval can be forthcoming to fund projects that are in line with government policies. For example, despite the general credit tightening, Chinese developers can obtain large quotas for China's new 'Rental Apartment Special Bonds' (长租公寓REIT), as the government tries to tackle the problem of housing affordability.  Amid the deleveraging campaign, it seems that not all debt is bad after all.
  • How Are International Trade Issues Influencing Global Markets?

    Source: Sam Tsui, Blu Putnam
    Date Submitted: 04 May 2018
    Views: 647
    Downloads: 0
    The fear of trade war has been intensified with announcement of import tariff by the U.S. S&P DJI’s Sam Tsui sits with CME Group’s Blu Putnam to discuss the international trade issues and the impacts on the economies.
  • Request for Comments: Sovereign Rating Criteria

    Source: Liang Zhong
    Date Submitted: 25 Apr 2018
    Views: 447
    Downloads: 6

    HONG KONG, 25 Apr 2018. Pengyuan International has today released its Sovereign Rating Criteria for public consultation. These criteria will be effective immediately on the date of final publication, and we intend to complete the review of all affected ratings, if any, within six months thereafter. We expect no impact on our current rating portfolio. 

     

    We would appreciate comments on these draft criteria from investors and other market participants. The request-for-comment version of the Criteria and analyst contact details are available via the following link:

     

    Sovereign Rating Criteria: http://www.pyrating.com/Methodology/Index/10008.html 

     

    Our Sovereign Rating Criteria describe our analytical approach to assessing the credit risks of all sovereigns and assigning issuer credit ratings (ICRs) and issuance credit ratings to sovereigns. We explain in detail how we assess the key rating factors (namely a sovereign issuer’s debt burden, stage of economic development, economic fundamentals, institutions and policies and distinctive movers of underlying liquidity risk) that together drive a sovereign’s indicative credit score (ICS). We also outline our other analytical considerations, which, together with the ICS, will determine an entity’s Issuer Credit Rating.  

    For these criteria, we define a sovereign as a member state of United Nations or a state that runs its own government, enjoys fiscal independence and determines its own monetary regime.

    MEDIA CONTACT
    media@pyrating.com
     
    OTHER ENQUIRIES
    contact@pyrating.com

  • The Impact of the Global Economy on the S&P 500®

    Source: Phillip Brzenk
    Date Submitted: 18 Apr 2018
    Views: 596
    Downloads: 10
    In this paper, we examine the geographic revenue distribution of the S&P 500 and see what, if any, impact foreign economies and geographically driven market events may have on overall index performance. 
  • SGX-Listed Stocks & ETFs with Exposure to Fast-Growing Malaysia

    Source: SGX MY Gateway
    Date Submitted: 10 Apr 2018
    Views: 220
    Downloads: 20
    SGX-Listed Stocks & ETFs with Exposure to Fast-Growing Malaysia
    • Malaysia’s economy is expected to grow by 5.3% in 2018, with BNM citing favourable income and labour market conditions, spending on new and ongoing infrastructure projects and sustained capital investment by firms in manufacturing and services sectors.
    • Singapore’s 10 largest capitalised stocks that report the majority of their revenue to Malaysia have averaged a 4% gain in the 2018 YTD. The 10 stocks span six Sectors, with the 2018 YTD gains taking their average 12M average total return to 20%.
    • Over the past 12M, Sunright led the performances of the 10 stocks, with a 136% total return. As one of the world’s largest independent providers of burn-in and test services, it reported 1HFY18 (ending 31 Jan) PBT YoY growth of 25%, building on PBT YoY growth of 75% in FY17.
  • The Next Gold Medal 

    Source: CAPER
    Date Submitted: 09 Apr 2018
    Views: 918
    Downloads: 20
    Key Points 

    The 2018 Winter Olympics sheds light on the changes taking place in South Korea where geopolitical forces have been unpredictable

    South Korea, as an export nation, is searching for its next export, with its shipbuilding industry having gone through a period of brutal consolidation 

    Private equity investment trends, especially by non-domestic investors, are hinting that those in Non-Heavy Industries could be South Korea’s next winning industry, based on their commitments and performance results of deals in this sector
  • AsianFA Are disagreement agreeable? Evidence from information aggregation

    Source: Dashan HUNAG, Jiangyuan LI, Liyao WANG, Guofu ZHOU
    Date Submitted: 02 Apr 2018
    Views: 73
    Downloads: 2
    Most studies on disagreement focus on cross-sectional asset returns and the well-recognized disagreement measures generally cannot predict the stock market with a horizon less than 12 months. This paper proposes three aggregate disagreement indexes by aggregating information across 20 disagreement measures. We show that disagreement measures collectively have a common component that has significant power in predicting the stock market both in- and out-of-sample. Consistent with the theory developed by Atmaz and Basak (2017), the indexes asymmetrically forecast the market with greater power in high sentiment periods. Moreover, the indexes negatively predict economic activities, and positively predict market volatility, illiquidity, and trading volume.
  • AsianFA Economic Depreciation in the Property Value: Cross-Sectional Variations and Their Implications on Investments

    Source: Jiro Yoshida,
    Date Submitted: 02 Apr 2018
    Views: 191
    Downloads: 9
    CFA Institute Asia-Pacific Research Exchange Best Paper Award:
    I would like my accepted AsianFA paper considered for the CFA Institute Asia-Pacific Research Exchange Award, 
  • AsianFA conference paper: Aggregate Expected Investment Growth and Stock Market Returns

    Source: Huijun Wang, University of Delaware, Jianfeng Yu, PBCSF, Tsinghua University, Jun Li, University of Texas at Dallas
    Date Submitted: 28 Mar 2018
    Views: 25
    Downloads: 2
    This is a conference paper accepted at 2018 Asian Finance Association annual meeting to be considered for the CFA Institute Asia-Pacific Research Exchange Award, 
  • Surveys and Countering Violent Extremism: A Practitioner Guide

    Source: Matthew Nanes, Bryony Lau
    Date Submitted: 30 Jan 2018
    Views: 59
    Downloads: 0
    The intent of this practitioner guide is to better acquaint development practitioners with the use of surveys in preventing or countering violent extremism (CVE). Surveys are an excellent way to gather systematic data about violent extremism, as well as the behaviors and attitudes of the general public or important segments of the population such as victims, potential perpetrators, and even extremists themselves. They can capture information about the drivers of violent extremism and reveal which are the most significant, in what areas, and among whom. When applied to programming, surveys can improve the targeting and design of projects and can measure results. This guide emphasizes that surveys are a powerful and flexible tool with many potential applications to CVE. It also underscores what surveys cannot do, and acknowledges that surveys will often be most effective when combined with qualitative and other quantitative methods. The advice provided will help practitioners ensure that their surveys yield accurate, useful data about violent extremism while gathering information ethically and safely.
  • Vietnam

    Source:
    Date Submitted: 30 Jan 2018
    Views: 121
    Downloads: 0
    The Asia Foundation has supported Vietnam’s ongoing transformation since 1993 through a network of partners in government, the private sector, and civil society. With a resident office in Hanoi since 2000, the Foundation supports Vietnam’s continued growth and rising regional and international stature with programs in critical areas such as women’s economic empowerment, environmental resilience, girls’ education, inclusive economic growth, migrant-worker rights, and regional and international integration.
  • Environment

    Source:
    Date Submitted: 30 Jan 2018
    Views: 135
    Downloads: 0
    Asia faces growing vulnerability to natural disasters, flooding, drought and other transboundary environmental problems, with severe consequences for rural and urban communities, food security, economic growth, and political stability. Environmental problems, by their very nature, are as complex as they are inevitable. They are the unintended by-products of the very development activities nations pursue to grow their economies. Addressing environmental issues requires strong governance structures to facilitate multi-sectoral and multilevel dialogue among government agencies, private sector, civil society, research institutions, and other stakeholders. Ultimately, solutions require collective political will: stakeholders from across sectors working toward a shared vision for socially, economically, and environmentally sustainable development. The Asia Foundation, drawing upon 60 years of governance experience, plays an essential role in helping Asian countries address critical national and regional environmental challenges.
  • Advancing Women’s Empowerment and Gender Equality in Vietnam

    Source:
    Date Submitted: 30 Jan 2018
    Views: 100
    Downloads: 0
    The Asia Foundation has worked to advance women’s empowerment in Vietnam for more than 25 years, recognizing that when women and girls thrive, families and communities flourish. By forging strategic partnerships with government institutions, local NGOs, and the private sector, we pioneer results-based projects to strengthen women’s and girls’ economic opportunities, political voice and participation, and rights and security, while pursuing an integrated approach that promotes gender equality across all sectors.
  • The New Golbal Agenda and the Future of the Multilateral Development Bank System

    Source: Amar Bhattacharya, Homi Kharas, Mark Plant, Annalisa Prizzon
    Date Submitted: 28 Feb 2018
    Views: 30
    Downloads: 0
    This paper suggests ways to improve policy and operational coherence among MDBs and outlines how better shareholder governance could bring this about. It focuses on the need for stepped-up financing of investments in developing countries, but should be viewed in the broader context of managing globalization, especially with regard to trade and financial stability.
  • Leave No Country Behind: Ending Poverty in the Toughest Places

    Source: Geoffrey Gertz, Homi Kharas
    Date Submitted: 28 Feb 2018
    Views: 0
    Downloads: 0
    In 2015, the members of the United Nations agreed to end extreme poverty by 2030, the first of 17 SDGs. For the world to achieve this, some 30 high poverty countries that have seen little to no poverty reduction in recent years will need to alter their current trajectories. These are the places where development is the most difficult, where entire countries and the people who live in them are at risk of being left behind.
  • TEPAV Employment Monitoring Bulletin - January 2018

    Source:
    Date Submitted: 26 Jan 2018
    Views: 68
    Downloads: 0
    The TEPAV Employment Monitoring Bulletin aims to compile the data released by the Social Security Institution (SSI) in order to reflect the big picture for registered employment and identify the short and medium-term employment trends. The Bulletin will be published regularly following the release of monthly SSI data. The Bulletin will include data on the “number of workers with insurance, sectors with increasing or decreasing employment figures, sectors of manufacturing with increased number of workers, provinces with increased and decreased numbers of workers, sectors with an increasing or decreasing number of work places, provinces with increasing or decreasing numbers of work places, sectors with increasing or decreasing numbers of female employees, and provinces where individuals receiving unemployment benefits have increased or decreased.” The Bulletin will present a diverse set of tables in line with the changes in the labor market trends.
  • TEPAV Retail Confidence Index -February 2018

    Source:
    Date Submitted: 02 Feb 2018
    Views: 92
    Downloads: 0
    TEPE, which had been -17.1 points in 2017, was -15.1 points in January1 2018. The Index saw a decrease by 1.4 points compared to the previous month and an increase by 0.8 points compared to the same month of last year. The monthly decrease is attributed to the m-o-m decrease in the level of sales expectations for the coming 3 months. Expectations of orders, sales and employment in the coming 3 months have declined when compared to January 2017 and December 2017. “Furniture, lighting equipment and household articles” sector scored the highest y-o-y increase in retail confidence in January. Furthermore, when compared to the EU-28 and Eurozone, Turkey experienced a declining performance with respect to last year.
  • Xero’s economic contribution to New Zealand

    Source: John Ballingall, Prince Siddharth, Daniel Pambudi.
    Date Submitted: 30 Jan 2018
    Views: 0
    Downloads: 0
    Xero has asked NZIER to provide an overview of Xero’s contribution to the New Zealand and global economy, focusing on: GDP contribution, Jobs and wages generated, Other sectors supported, Contribution to the Small Business (SB) sector, Building a world class technology business from New Zealand through investment, Building a global export business from New Zealand and Contribution to SBs worldwide.
  • NZIER’s Shadow Board recommends keeping the OCR on hold amidst a soft inflation environment and uncertainty over the new Government

    Source:
    Date Submitted: 07 Feb 2018
    Views: 7
    Downloads: 0
    NZIER’s Monetary Policy Shadow Board continues to recommend the Reserve Bank leave the Official Cash Rate on hold this Thursday at 1.75 percent. Businesses are pessimistic about the effects of new Government policies. Along with softer than expected inflation, Board members indicated the Reserve Bank should remain cautious as to when it starts to lift the OCR.
  • The economic contribution of NZX: New Zealand’s exchange and its role in supporting the New Zealand economy

    Source: John Ballingall, John Yeabsley, Aaron Drew, Daniel Pambudi
    Date Submitted: 28 Feb 2018
    Views: 106
    Downloads: 0
    NZX has asked NZIER to provide an independent assessment of its direct and indirect value to the New Zealand economy.
  • Disciplines on State-Owned Enterprises under the Trans-Pacific Partnership Agreement: Overview and Assessment

    Source:
    Date Submitted: 28 Feb 2018
    Views: 0
    Downloads: 0
    This paper analyses the disciplines os state-owned enterprises (SOEs) stipulated in Chapter 17 of the Trans-Pacific Partnership Agreement (TPP). The introduction of the extensive disciplines on SOEs was led by the concern that SOEs are likely to disturb fair international competition regime by conducting business activities not depending on econmic rationality and anticompetitive activities. Major provision of this chapter includes definitions and the scope of application, and transparency. While Chapter 17 can be appreciated as the first comprehensive and detailed discipline on SOEs including that of the WTO-plus, it still has problems and remaining issues concerning the disciplines. Nevertheless, the very fact that the TPP includes specific rules for SOEs is appreciated as a first step towards disciplining them in the future.
  • Formulating Policy Options for Promoting Natural Gas Utilization in the East Asia Summit Region: Volume II: Supply Side Analysis

    Source:
    Date Submitted: 28 Feb 2018
    Views: 62
    Downloads: 0
    This part II of the report discusses two main topics: how much liquefied natural gas (LNG) supply infrastructures are needed in the Association of Southeast Asian Nations (ASEAN) + India by 2030 to satisfy the LNG demand projection results presented in Part I; and how much investments are required by 2030 to implement the identified LNG supply infrastructure in ASEAN and India.
  • Formulating Policy Options for Promoting Natural Gas Utilization in the East Asia Summit Region: Volume I: Demand Side Analysis

    Source:
    Date Submitted: 30 Jan 2018
    Views: 0
    Downloads: 0
    This study investigates the future natural gas demand in ASEAN countries and India as well as the necessary investment needed to meet the demand. It shall provide a picture on the market size of natural gas in EAS countries, identify the challenges faced in expanding the natrual gas market and propose options to address identified issues.
  • Frames: news, thoughts, updates - February 2018

    Source:
    Date Submitted: 01 Feb 2018
    Views: 0
    Downloads: 0
    Frames is a monthly newsletter produced by the Economic Research Institute for ASEAN and East Asia. Each edition covers news, thoughts and updates involving ASEAN and East Asia.
  • Frames: news, thoughts, updates - January 2018

    Source:
    Date Submitted: 30 Jan 2018
    Views: 0
    Downloads: 0
    Frames is a monthly newsletter produced by the Economic Research Institute for ASEAN and East Asia. Each edition covers news, thoughts and updates involving ASEAN and East Asia.
  • China’s Turning To “Tough Gradualism” In Disciplinng Local Government Borrowing Foretells Higher Risk of LGFV Default

    Source: Liang Zhong
    Date Submitted: 27 Feb 2018
    Views: 678
    Downloads: 6
    Creditors to China’s local government financing vehicles (LGFVs) may have some reasons to worry about their investment in these entities. Ministry of Finance in China vowed last month to break decisively the illusion of financial institutions about government bailing them out of hidden debt incurred by local governments (primarily through LGFVs). A central bank official even suggested to resort to a Detroit-type bankruptcy of local government (LGT) to break moral hazard in lending to LGFVs. These developments bring back the memory of the bankruptcy of GITIC (Guangdong International Trust and Investment Company), a high profile LGFV in China in 1999 amid mounting risk of local government hidden borrowing.
     
    However, history progresses in spiral, according to the guiding philosophy of Chinese policymakers. Thus, no wondering China appears to be getting closer to, yet is quite away from point where central government has to resort to default on LGFV bond to instill financial discipline and secure the systemic stability. Pengyuan International believes Chinese government is indeed turning to “tough gradualism” (gradually tightening discipline over LGT borrowing in practice) rather than “shock therapy” (allow LGFV default up-front); Accordingly, the risk that the first LGFV public bond default could strike in 2018 is picking up from very low level, but is still less than 50% in our estimate.  Nevertheless, further scrutiny over LGFV creditworthiness becomes increasingly necessary.
  • Webinar: China Property-The Significance of the Property Sector to China's Economy

    Source: Cheong Yin Chin, CFA, Luther Chai
    Date Submitted: 25 Feb 2018
    Views: 310
    Downloads: 0
    Residential home prices in China have been kept steady by an onslaught of tightening policy measures across the country since September 2016. With cities such as Lanzhou relaxing some of its restrictive measures at the start of this year, could we be on the cusp of an easing cycle?

    This on-demand 15-minute webcast explains the importance of the Chinese real estate sector and delivers a summary overview of our recent research reports. 
  • China Consumer Finance Market Insights

    Source: Working Group of CFA China Shanghai CrowdResearch Project(Zhang Shuguang, CFA; Chen Yan, CFA;Gu Yuan, CFA; Li Chen, CFA;Wang Yingren, CFA;Ying Yi, CFA and Zhao Yang, CFA)
    Date Submitted: 04 Sep 2018
    Views: 47814
    Downloads: 260
    This article qualifies for 0.5 CE under the guidelines of the CFA Institute Continuing Education Program. 
    We encourage CFA Institute members to login to the CE tracking tool to self-document these credits. 


    After many years of initial development, China's consumer finance market, with the rapid development of Internet finance and e-commerce, has entered a period of market eruption. Now it is rapidly penetrating into all walks of life in the society and catching the attention from many investment institutions. Against such background, we conducted an industry research on this market, hoping to explore the development trend of the industry, put forward development proposals for the enterprises in the industry, and help investors to identify the investment trend.
     
    In Introduction and Chapter I, we define consumer finance and the scope of this study, and analyze the consumer financial behavior. The essence of consumer financial behavior is that consumers pay certain financial costs to change the disposable capital flow within a specified period to match their consumption demand. Target customers of consumer finance are those who have demand for consumption but lack liquidity, and are willing to advance their consumption and have sufficient repayment ability.
     
    In Chapter II, we review the history of the development of China's consumer finance industry and the evolution of the relevant policies. We also narrate the industry development in the United States, Europe and Japan, which provides us with reference to analyze China's future industry trends.
     
    Chapter III centers on the industry chain of consumer finance and expounds the current development of the industry in China. It covers different types of consumer finance companies, including banks, licensed consumer finance companies, Internet giants, P2P, e-commerce, start-ups and industry companies, as well as various consumer finance scenarios and special consumer groups including automobile, travel, medical cosmetology, education, rural area, house rental, home improvement, college students and blue-collar workers. In addition, we count a total of 356 financing incidents among 52 consumer finance companies. Data shows MatrixPartners China, Sequoia Capital, Bluerun Ventures, Source Code Capital and Shunwei Capital are the most active investment institutions in China's consumer finance market, and in terms of market segments arrangement, they often focus their support on one or two potential enterprises to give many rounds of investment.
     
    In Chapter IV, we discuss the future development trend of China's consumer finance industry from three aspects: industry macro environment, various types of consumer finance companies and various consumption scenarios.
  • Monetary Policy Statement, H2 FY'18 Highlights

    Source: Mohammad Rehan Kabir, Md. Nazmus Sakib
    Date Submitted: 30 Jan 2018
    Views: 297
    Downloads: 25
    Bangladesh Bank is going to pursue a ‘Cautionary’ monetary policy stance for the second half of FY18 with an aim at bringing back monetary aggregates to a sustainable growth trends by ensuring the quality of credit flows rather than restricting it.  Current monetary policy stance is formulated for the second half of FY’18 considering the actual result of H1, FY’18 and the target made for H2, FY’18. Prior to national election, Central Bank of Bangladesh undertakes a growth supportive but cautious monetary policy stance with an aim to bring price stability.
  • A Proposal for Building Triangular Energy Cooperation between Korea, Iran and Turkmenistan

    Source: Kwon Hyung Lee
    Date Submitted: 17 Oct 2017
    Views: 0
    Downloads: 0
    Korea has developed bilateral relations for economic cooperation with emerging countries in the Middle East and Central Asia. G2G (govern-ment-to-government) joint committees have been organized to improve the economic environment for trade and investment between two countries. However, bilateral economic partnership could reveal some limita-tions in developing broader cooperation due to the industrial and geo-graphical peculiarities of partner countries
  • Norway

    Source:
    Date Submitted: 30 Apr 2017
    Views: 40
    Downloads: 0
    The Asian Development Bank (ADB) is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region—who have committed $247.28 billion in loans to the vision of a region free of poverty. Despite the region’s many successes, it remains home to the majority of the world’s poor. Norway has contributed $485.57 million in capital subscription as of 31 December 2016. It has contributed and committed $243.43 million to Special Funds since joining in 1966.
  • Growth despite Sanctions? Revisiting the Effect of North Korea Sanctions

    Source: Soo Ho Lim
    Date Submitted: 18 Sep 2017
    Views: 0
    Downloads: 0
    Recently the central bank of Korea, the Bank of Korea, announced that North Korea's GDP in 2016 increased by 3.9%p compared with the pre-vious year. In 2016, the UN passed two resolutions for strong economic sanctions on North Korea, UNSCR 2270 and 2321. This economic per-formance, therefore, seems to support and even prove the popular hy-pothesis among North Korean experts that sanctions against North Ko-rea are useless. This article deals with this recent phenomenon of "growth despite sanction" in North Korea.
  • The Transmission of Interest Rate hocks to Asia - Are Effects Different below the Zero Lower Bound?

    Source: Martin Feldkircher, Florian Huber, Pornpinun Chantapacdepong, Maria Teresa Punzi
    Date Submitted: 30 Mar 2017
    Views: 175
    Downloads: 0
    We use a non-linear factor-augmented vector-autoregressive model to evaluate international effects of an unexpected decrease in euro area policy rates. Given the current environment of ultra low or negative interest rates, we especially focus on potential differences in the transmission of the monetary policy shock depending on the level of interest rates in the country from where the shock originates, i.e., the euro area. A euro area monetary policy shock when euro area interest rates are positive at the time the shock occurs tends to trigger positive spillovers to industrial production, house and stock prices and negative effects on short- and long-term interest rates, as well as on inflation. Results tend to be similar when interest rates are already below zero at the time monetary policy turns out to be expansionary, however responses are estimated with a larger degree of uncertainty. In some cases, a distinct transmission depending on the level of interest rates in the euro area, is observable but no general patterns emerge from the data.
  • Carry Trades in Asia and the Pacific: Evidence on Unconventional Monetary Policies of Advanced Ecomomies

    Source: Pornpinun Chantapacpedong, Hiroyuki Ito, Kieran Hull
    Date Submitted: 15 Dec 2017
    Views: 75
    Downloads: 0
    Since the Global Financial Crisis (GFC) of 2008, the world economy has faced many challenges and changes, which led us to reassess the uncovered interest rate parity (UIP). We are particularly interested in whether and to what extent unconventional monetary policy (UMP) affects the UIP relationship for 11 currencies in Asia and the Pacific. When we run the Fama regression for the period of 2001 through 2016, we show that UIP does not hold, consistent with previous studies. We augment the original Fama regression with a set of variables that represent financial and macroeconomic conditions as well as unconventional monetary policies. We find that the unconventional monetary policies in advanced economies have a significant effect on the Fama beta. The QE in the US and QQE in Japan cause the Fama beta to be more negative, implying carry trade activities and “search for yield” behaviour. On the other hand, the negative interest rate policy (NIRP), especially in the Eurozone and Switzerland, seem to cause greater uncertainty and have a positive effect on the Fama beta.
  • 2018 Global Economic Outlook and Implications for Korea

    Source: Sung-Chun Jung
    Date Submitted: 08 Nov 2017
    Views: 170
    Downloads: 0
    The world economy is yet to make a complete recovery from the 2008 global economic crisis. It is still suffering from a long period of weak economic activity. However beginning from this year, a somewhat differ-ent economic landscape is unfolding.
  • External Debt Sustainability and Vulnerabilities: Evidence from a Panel of 24 Asian Countries and Prospective Analysis

    Source: Matthieu Llorca
    Date Submitted: 30 Mar 2017
    Views: 0
    Downloads: 0
    The purpose of this empirical study is first to assess the external debt sustainability in a panel of 24 Asian emerging and developing countries divided into four sub-panels, namely the regions of Southeast Asia, Southwest Asia, Central Asia, and the Pacific over the period 1993–2014. We use the present-value methodology to determine whether a country satisfies its intertemporal external constraint, namely whether its external debt is sustainable in the long run. According to such methodology, we study the panel stationarity of external debt, current account, imports, and exports, then the cointegration between these two last variables. We employ unit root and cointegration tests, the first and second generation tests, to take into account cross-sectional dependence. Our findings imply that the external debt in our panel of 24 Asian emerging and developing countries is sustainable in the long run. Finally, we analyze the vulnerabilities, factors, and risks in the region due to different external debt criteria (the debt currency composition, share of the short-term external debt, amount of reserves, and debt service). We conclude this study by establishing different prospective scenarios on the Asian emerging and developing countries according to the degree of economic slowdown (i.e., a “soft” or “hard” landing) in the People's Republic of China.
  • Decreased Effectiveness of Fiscal and Monetary Policies in Japan's Aging Society

    Source: Naoyuki Yoshino, Hiroaki Miyamoto
    Date Submitted: 30 Mar 2017
    Views: 74
    Downloads: 0
    This paper studies how an aging population affects economic performance and the effectiveness of fiscal and monetary policies. We develop a New Keynesian dynamic stochastic general equilibrium model with heterogeneous households, workers, and retirees. We demonstrate that an increase in the proportion of working population increases aggregate output, consumption, and investment by increasing total labor supply in the long run. It also increases wages and reduces social security burden of the government. This paper also finds that effectiveness of fiscal and monetary policies is weakened when the proportion of retirees becomes larger. This is the reason why recent monetary policies cannot recover the Japanese economy from the prolonged stagnation.
  • Afghanistan

    Source:
    Date Submitted: 30 Apr 2017
    Views: 0
    Downloads: 0
    Afghanistan was a founding member of the Asian Development Bank (ADB) in 1966 and has since been supported by ADB over two periods. Resuming its partnership with Afghanistan after a hiatus from 1980 to 2001, ADB—in collaboration with other development partners—supports the country’s national development strategies and its national priority programs. At the Brussels Conference on Afghanistan in October 2016, the Government of Afghanistan and the international community reaffirmed their partnerships in the medium to long term. The government also presented the Afghanistan National Peace and Development Framework, which will guide the country’s development path in the coming years.
  • Australia

    Source:
    Date Submitted: 30 Apr 2017
    Views: 0
    Downloads: 0
    The Asian Development Bank (ADB) is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region—who have committed $247.28 billion in loans to the vision of a region free of poverty. Despite the region’s many successes, it remains home to the majority of the world’s poor. Australia has contributed $8.26 billion in capital subscription as of 31 December 2016. It has contributed and committed $2.14 billion to Special Funds since joining in 1966.
  • Measuring the Effects of Commodity Price Shocks on Asian Economies

    Source: Tomoo Inoue, Tatsuyoshi Okimoto
    Date Submitted: 30 Mar 2017
    Views: 202
    Downloads: 0
    Commodity prices have become volatile over the past 2 decades, and their recent sharp decline has decreased the consumer price index inflation rates for most economies. While many Asian economies have benefited from low international oil and food prices, commodity exporters have suffered. Thus, the negative impact on production through the decline of producer prices has attracted considerable attention. Given this situation, policy makers have become increasingly concerned about measuring the magnitude of oil and food price shock diffusion on a country’s various inflationary indicators. This study investigates this problem by using a Global Vector Autoregressive model. We extend the work by Galesi and Lombardi (2009), which primarily analyzed European economies using data from the pre-Global Financial Crisis (GFC) period, in the following four ways: (i) the sample period is extended to December 2015, thus covering the post-GFC turbulence period (beginning from January 2001); (ii) the model is enriched by considering the People’s Republic of China’s role in integrating the Asian region through international trade; (iii) the producer price index is included; and (iv) the impact on industrial production is investigated. Using generalized impulse response functions, we examine the impact of a one-time hike in oil and food prices on the general price levels and production for nine Asian countries and 13 other countries, including the United States and the eurozone. We also analyze the differences of shock propagations in the pre- and post-GFC periods. Results indicate that the increased integration and dependence on exports intensified the Asian region’s vulnerability to external shocks.
  • Financial Deepening and Innovation Efficiency: The Role of Political Institutions

    Source: Chun-Yu Ho, Shaoqing Huang, Hao Shi, Jun Wu
    Date Submitted: 30 Mar 2017
    Views: 133
    Downloads: 0
    This study investigates the effects of financial deepening on innovation efficiency for various democratic levels of political institutions using panel data from 69 countries spanning 1970–2010. Banking market deepening is associated with increased innovation efficiency only when political institutions are sufficiently democratic. In contrast, the enhancing effect of stock market deepening on innovation efficiency requires a lower level of political democracy. Furthermore, the results are stronger for countries with lower incomes than for countries with higher incomes. Our results are robust for the use of the instrumental variable approach and alternative measures for financial deepening, democracy, and innovation inputs.
  • Belgium

    Source:
    Date Submitted: 30 Apr 2017
    Views: 8
    Downloads: 0
    The Asian Development Bank (ADB) is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region—who have committed $247.28 billion in loans to the vision of a region free of poverty. Despite the region’s many successes, it remains home to the majority of the world’s poor. Belgium has contributed $485.57 million in capital subscription as of 31 December 2016. It has contributed and committed $246.80 million to Special Funds since joining in 1966.
  • Bangladesh

    Source:
    Date Submitted: 30 Apr 2017
    Views: 146
    Downloads: 0
    The Asian Development Bank (ADB) has been a development partner of Bangladesh since 1973, and established its first field office in 1982 in Dhaka. ADB has provided Bangladesh with $18.3 billion for 269 loans, $252.4 million for 422 technical assistance projects, and $787.10 million for 35 grants. Bangladesh is a major recipient of concessional resources.
  • Azerbaijan

    Source:
    Date Submitted: 30 Apr 2017
    Views: 0
    Downloads: 0
    Azerbaijan joined the Asian Development Bank (ADB) in 1999, and ADB has since approved $3.65 billion in lending, grants, and technical assistance. ADB operations in Azerbaijan were initially guided by an interim operations strategy approved in 2000, and followed by five program updates. In 2013, ADB reclassified Azerbaijan as a middle-income country, making it no longer eligible for ADB concessional lending from Asian Development Fund resources.
  • Austria

    Source:
    Date Submitted: 30 Apr 2017
    Views: 0
    Downloads: 0
    The Asian Development Bank (ADB) is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region—who have committed $247.28 billion in loans to the vision of a region free of poverty. Despite the region’s many successes, it remains home to the majority of the world’s poor. Austria has contributed $485.57 million in capital subscription as of 31 December 2016. It has contributed and committed $272.20 million to Special Funds since joining in 1966.
  • Canada

    Source:
    Date Submitted: 30 Apr 2017
    Views: 0
    Downloads: 0
    The Asian Development Bank (ADB) is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region—who have committed $247.28 billion in loans to the vision of a region free of poverty. Despite the region’s many successes, it remains home to the majority of the world’s poor. Canada has contributed $7.46 billion in capital subscription as of 31 December 2016. It has contributed and committed $1.82 billion to Special Funds since joining in 1966.
  • Cambodia

    Source:
    Date Submitted: 30 Apr 2017
    Views: 126
    Downloads: 0
    Over the past 5 years, Cambodia has been one of the fastest-growing economies in Southeast Asia. This economic progress has helped reduce the country’s poverty rate from 47.8% in 2007 to 13.5% in 2014, although more than 70% of Cambodians still live on less than $3 a day. In July 2016, the World Bank officially revised the status of Cambodia’s economy to lower middle income status. Cambodia’s growth model of attracting foreign direct investment through inexpensive, low-skilled, and abundant labor has delivered recent economic expansion, but may not be viable for much longer. Productivity growth has been low, while labor costs and skills shortages are increasing. Sustaining high growth will require revitalization of agriculture, diversification of the economy, and greater value-added production. New industries will require improved logistics and a broader range of advanced skills.
  • Bhutan

    Source:
    Date Submitted: 30 Apr 2017
    Views: 111
    Downloads: 0
    The Kingdom of Bhutan is a landlocked country that depends on the generation of hydropower to boost its economy. Hydropower contributes about a fifth of Bhutan’s gross domestic product. Bhutan is currently one of the fastest growing economies in South Asia, and has recently made significant progress on poverty reduction. Growth averaged 7.6% over the past 3 decades, and poverty was cut roughly in half between 2007 and 2012. Yet despite solid growth and strong socioeconomic advances, the challenge remains for Bhutan to expand its economic base and make growth more inclusive, especially for unemployed youth and women. Developing a vibrant private sector is key to diversifying Bhutan’s economy and creating a more balanced, broadbased, and job-creating growth.
  • The Effect of Restructuring on Labor Reallocation and Productivity Growth: An Estimation for Korea

    Source: Hyelin Choi, Sung Chun Jung, Subin Kim
    Date Submitted: 15 Sep 2017
    Views: 0
    Downloads: 0
    Productivity is considered one of the most important factors for economic growth. Total productivity grows through technological progress or reallocation of re­sources. This paper analyses their contribution to economic growth for total economy and by sectors. The main finding is that economy-wide increases but this is mainly due to internal technological improvements. On the one hand, inter-sector reallocation of labor negatively contributes to economic growth as employment moves to service sectors with low productivity. Further, when looking at the sec­toral-level productivity growth, both internal and external restructuring make positive contributions to aggregate economic growth. However, internal technological progress and reallocation of employment appear to similarly contribute to the sectoral-level economic growth in the manufacturing sector, whereas internal restruc­turing makes a larger contribution to economic growth in the service sector. This suggests that there is more room for reallocation of resources to contribute to the productivity growth in service sectors. Therefore, the productivity growth of the service sector would foster economy-wide productivity and it can be achieved by the mitigation of misallocation of resources in service sectors.
  • IMF on China: A Downturn is Inevitable

    Source: Jonathan Rochford
    Date Submitted: 25 Jan 2018
    Views: 1491
    Downloads: 101
    A recent working paper from the IMF titled “Credit Booms – Is China Different?” provides a good summary of many of the key issues facing China’s economy. Rapid credit growth since the global financial crisis is record setting for both its total expansion and its duration. Credit is being poorly used with the most inefficient sectors and firms grabbing large shares of new debt. Banks have seen rapid growth in their size and complexity and when combined with a heavy reliance on short term funding this creates a major risk of a liquidity crisis.
     
    Whilst using diplomatic language the working paper makes clear that China may be able to continue its current trajectory for the medium term but in the long term a downturn, likely accompanied by a banking crisis is inevitable. This paper reviews the key points from the IMF paper and adds commentary on issues that the IMF paper omits.
  • Market Outlook for 2018

    Source: Mohammad Rehan Kabir
    Date Submitted: 22 Jan 2018
    Views: 381
    Downloads: 49
    Our market outlook for 2018 is supported by optimism even after some glitches from economy are expected. In 2017, our capital market resembled a robust growth posting an impressive return of 24.0%. During that period, Dow Jones Industrial Average Index provided 24.2% return and SENSEX provided 29.4% return. We expect market return will remain positive in 2018, however market return may be lower than that of in 2017.Market Capitalization to GDP in DSE was 18.35% at the end of December, ’17 which was 23.56% in Colombo SE, 27.59% in Pakistan SE, 88.63% in BSE (India). We anticipate this proportion will increase further in 2018. Unlike 2017, market drivers will be from Fast Moving Consumer Good providers, Pharmaceutical and Construction Sectors. Though financial sector will face few challenges like governance issues, increased default loans, unexpected change in management, financial scams and liquidity crunch etc. but banks with strong financials and  corporate governance along with good dividend payout ratio will do well in 2018.
  • TIC Panel: Investment Opportunities in APAC (12OCT2017)

    Source: April Lynn Tan, CFA, Biharilal Deora, CFA, Ashraf Bava, CFA, Andrew Stotz, CFA, Nguyen Thi Vinh Ha, CFA
    Date Submitted: 24 Apr 2018
    Views: 314
    Downloads: 0
    Taiwan Investment Conference (12OCT2017)
    Panel: Investment Opportunities in APAC
    Moderator: Andrew Stotz, CFA (Society Leader of Thailand)
    Panelists: Nguyen Thi Vinh Ha, CFA (Society Leader of Vietnam) / April Lynn Tan, CFA (Society Leader of Philippines) / Biharilal Deora, CFA (Society Leader of India) / Ashraf Bava, CFA (Society Leader of Pakistan)
  • Bangladesh Money Market Scenario and Outlook

    Source: Md. Nazmus Sakib
    Date Submitted: 11 Jan 2018
    Views: 1227
    Downloads: 74
    Money market of Bangladesh has gone through some swift changes due to the backlash on the liquidity. Liquidity drag has been mainly occurred due to the extensive private sector credit growth keeping most of the banks’ advance deposit ratio (ADR) close to 85%. At least 12 commercial banks including the public banks have exceeded the existing ADR limit. Private sector credit growth was mainly fuelled by borrowers’ appetite for cheap fund and banks’ opportunity to generate profit. As a drive to squeeze the excessive private sector credit growth, Bangladesh Bank plans to curtail limit on advance-deposit ratio which will persuade banks to seek large deposits in short time. To pursue the objective, deposit rate needs to be attractive for all sorts of potential depositors. The impact is already apparent in the interest rates of banks. According to the industry participants, interest rate has gone up by around 1% already from October, 2017. Upward pressure on USD has also led to a critical scenario for retaining strong liquidity of BDT. Import of consumer goods has surged to a massive level due to shortage of food supply. Furthermore, import of capital machineries has also gone up as construction of large development projects are on the pipeline. Unless strong interference is initiated by Government, USD may escalate further and lead to squeezed liquidity. Interest rate is supposed to go up further in 2018.
  • 金融周期下的政策选择

    Source: 施东辉博士,上海证券交易所资本市场研究所所长
    Date Submitted: 08 Jan 2018
    Views: 552
    Downloads: 7
    2017年12月17日,由CFA中国上海主办的2017年度上海金融分析师年会暨CFA资格认证授证仪式成功举办。近700位来自国内外知名金融机构的金融专业人士、政府官员和学界人士汇聚一堂,在为2017年度新晋CFA资格认证持证人举杯欢庆的同时,也对金融投资行业热点趋势和职业发展规划进行分享。

    会议中,CFA中国上海很荣幸地邀请到了来自上海证券交易所资本市场研究所的所长施东辉博士与在座来宾分享了“金融周期下的政策选择”。
  • 宏观经济创新驱动新时代

    Source: 邵宇博士,东方证券首席经济学家
    Date Submitted: 08 Jan 2018
    Views: 399
    Downloads: 7
    2017年12月17日,由CFA中国上海主办的2017年度上海金融分析师年会暨CFA资格认证授证仪式成功举办。近700位来自国内外知名金融机构的金融专业人士、政府官员和学界人士汇聚一堂,在为2017年度新晋CFA资格认证持证人举杯欢庆的同时,也对金融投资行业热点趋势和职业发展规划进行分享。

    会议中,CFA中国上海很荣幸地邀请到了来自东方证券的首席经济学家邵宇博士与在座来宾分享了新时代新经济下未来金融趋势。
  • Structure of Spot Rates and Duration Hedging

    Source: Bing-Huei Lin, Jr-Yan Wang, Shih-Wen Tai
    Date Submitted: 15 Aug 2011
    Views: 139
    Downloads: 0
    The present study proposes a three-factor model using spot rates as proxies for the state variables of the term structure of interest rates. Empirical analysis is carried out on the in-sample explanatory power and the out-of-sample prediction ability of spot-rate models, and comparison is made between the modified Macaulay duration and spot-rate duration hedging for bond portfolios.
  • The prevalence of global stock market inefficiencies gives rise to ample opportunities for stock picking

    Source: Chan Fook Leong, CFA
    Date Submitted: 19 Dec 2017
    Views: 1777
    Downloads: 0
    Media Release

    The prevalence of global stock market inefficiencies gives rise to ample opportunities for stock picking
     
    • Active management can yield alpha from inefficiencies in global equity markets particularly in the Asia Pacific region and in emerging markets 
    • These opportunities to generate excess risk-adjusted returns are in spite of trading costs 
    • There is a positive relation between transaction costs including the presence of short selling restrictions and alpha
     
    By Chan Fook Leong, CFA, for Asia-Pacific Research Exchange (ARX)
     
    Singapore, November 14. Professor Söhnke M. Bartram from University of Warwick highlighted the prevalence of global stock market inefficiencies over a lunch-time talk to a full house of CFA charter holders in the FTSE Room on the 9th floor of Capital Tower, Singapore.

    When there are deviations from fair value, stock picking can yield alpha. The mispricing in equities is prevalent globally, particularly in the Asia Pacific region and in emerging markets as uncovered by Professor’s Bartram research project using point-in-time accounting data from more than 25,000 stocks from 36 countries over a period of more than two decades.

    He and joint researcher, Mark Grinblatt, showed that the risk-adjusted returns are significantly larger in emerging than developed markets, suggesting that emerging markets are less efficient at incorporating material public information.

    Potential profits are also larger in the Asia Pacific region. Equity markets in Asia Pacific, the region with the largest alpha, experiences 26-50 basis point additional alpha compared to the Americas even after factoring in differences in the state of economic development.  

    In their research, fair value is determined using replicating portfolios instead of the more conventional discounted cash flow model or the structural asset pricing model where assumptions such as terminal growth and discount rates need to be determined. The replicating portfolio method is a simplistic non-discretionary approach as it relies on less assumptions to arrive at the fair value of a stock. Using international accounting data which is readily available to investors, firms with the same accounting metrics should have identical fair values.

    The replicating portfolios assign monthly fair values to more than 25,000 firms from 36 countries from 1993 to 2016. Thereafter, ordinary least square regression methods are employed to determine the most under- and over-priced stocks. Professor Bartram found that mispricing is greater in emerging markets and in the Asia Pacific region.

    The proxy of trading costs in this research are costs typically incurred by institutional investors. The study also shows that constructing a long-short portfolio still yields positive alpha in spite of trading costs from fees, commissions, and market impact. Moreover, simple adaptations of strategies that reduce turnover such as buy-and-hold strategy can improve alpha in emerging markets.

    Transaction costs which include trading and compliance costs also predict potential profitability – there is a positive relation between such costs and alpha even after controlling for variables such as the quality of a country’s information environment, its level of economic and financial development, and its regulatory framework. This implies that a hypothetical country with zero transaction costs will be devoid of alpha.  

    The other determinant of the level of alpha is the presence of short selling restrictions and other characteristics that might curb arbitrage activities. Limiting arbitrage activities impede the process of stocks reverting to fair value which in turn gives rise to mis-priced stocks.

    Stock market inefficiencies leads to presence of higher alpha in emerging markets and the Asia Pacific region compared to other parts of the world. The former two market or region represent the amongst highest transaction costs including the presence of the prohibition of short selling relative to others, and thereby leading to higher alphas waiting to be realized from picking these severely mis-priced stocks. Best of luck.
     
     
    The full research report can be downloaded from the Asia-Pacific Research Exchange (ARX) website (https://www.arx.cfa)
     
     
  • Japanese Banks: BOJ's Take on Financial Stability

    Source: David Marshall
    Date Submitted: 30 Oct 2017
    Views: 474
    Downloads: 0
    • In its latest financial stability report the BOJ highlights the unusually low profitability of Japanese banks and expresses concerns about the soundness of some lenders and risks to the efficiency of credit allocation
    • Too many lenders are fighting for a shrinking market as the population and the number of firms declines
    • Nevertheless, domestic lending has been growing at around 3%, more strongly at the regional banks than the majors, led by real estate lending to SMEs
    • Overseas funding costs have risen which has led Japanese banks to slow their growth in overseas lending and securities investment to focus more on risk and returns
    • Domestically the banks have shed yen bonds as the BOJ has bought JGBs but holdings by the major banks have picked up recently and all the banks have increased holdings of investment trusts in pursuit of higher returns  
    • As domestic loan growth has exceeded GDP growth, Japan's credit/GDP ratio has been rising, but this comes after a declining trend that has lasted more than 20 years. Before its bubble burst, Japan's ratio peaked at something close to the level that China's corporate debt/GDP is now reaching
    • The BOJ sees Japan's banking system as basically stable, but facing profitability challenges from a shrinking customer base, low lending rates, inefficiency and limited income diversification.
  • AFM - Financial Development, Macro Uncertainty and Saving-Cash Flow Sensitivity

    Source: Alexander Vadilyev
    Date Submitted: 26 Oct 2017
    Views: 310
    Downloads: 9
    This paper shows that (1) the sensitivity of corporate saving to cash flow does not systematically decrease with a country’s financial development, and (2) the sensitivity systematically increases with macro uncertainty. The first result occurs because income variability matters more for saving than external finance constraints and because income variability is strongly positively correlated with financial development. The second result occurs because macro uncertainty magnifies the effect of external finance constraints on corporate saving, raises the variability of income flows, and reduces the attractiveness of investment opportunities. Therefore, contrary to previous evidence, saving-cash flow sensitivity cannot be directly used to test for the benefits of financial (and institutional) development, but it can be used to assess the impact of uncertainty on firms’ demand for internal liquidity.
  • Impact analysis of global fuel price slump

    Source: Akramul Alam, CIMA part qualified
    Date Submitted: 17 Oct 2017
    Views: 188
    Downloads: 13
    Impact analysis of global fuel price slump.
  • Panel: Investment Opportunities in APAC

    Source: Andrew Stotz, PhD, CFA
    Date Submitted: 23 Apr 2018
    Views: 18881
    Downloads: 0

    The 2017 Taiwan Investment Conference on 12 October 2017 to celebrate the 10th anniversary of CFA Society Taiwan. Keynote speakers and panel discussions highlight hot investment topics in Taiwan and the region. This post relates to the panel discussion on Investment Opportunities in APAC.

    Moderator: Andrew Stotz, PhD, CFAA. Stotz Investment Research

    Panel: Nguyen Thi Vinh Ha, CFAPartner at Grant Thornton (Vietnam)Ashraf Bava, CFAChief Executive at Nael Capital (Pvt) LimitedApril Lynn Tan, CFAVice President and Head of Research at COL Financial, and Biharilal Deora, CFA, CIPM, FCA, CFP, CIWMPartner at BDVG & Associates.

    Markets discussed: India, Pakistan, the Philippines, Thailand, and Vietnam.

  • Estimating Tenure Choice and Housing Demand in the Philippines

    Source: Nicole Danika Bondad, Queennie Mindanao
    Date Submitted: 07 Oct 2017
    Views: 196
    Downloads: 2
    The study estimates housing demand and the probability of homeownership in the Philippines. Through an empirical analysis of household-level data in 2009, the research examines the price and income elasticities of both homeowners and renter-households in the country. Addressing the difficulty of measuring housing prices accurately, the researchers apply a two-equation model comprised of tenure choice and housing demand functions with price, income, and family size as the main explanatory variables.
     
    Further, the paper evaluates the effectiveness of housing subsidy programs in the Philippines.
  • Central Bank Balance Sheet Policies and Spillovers to Emerging Markets 

    Source: HAOBIN WANG, MANMOHAN SINGH
    Date Submitted: 29 Sep 2017
    Views: 838
    Downloads: 19

    We develop a theoretical model that shows that in the near future, the monetary policies of some key central banks in advanced economies (AEs) will have two dimensionschanges in short-term policy rates and balance sheet adjustments. This will affect emerging market economies (EMs), especially those with a pegged exchange rate, as these EMs primarily use a single monetary policy tool, i.e., the short-term policy rate. We show that changes in policy rates and balance sheet adjustments in AEs may differ in their respective financial spillovers to pegged EMs. Thus, it will be difficult for EMs to mitigate different types of spillovers with a single monetary policy tool. In that context, we use the model to show how EMs might use additional toolscapital controls and/or macro-prudential policyto complement their monetary policy and financial stability toolkit. We also discuss how balance sheet adjustments that affect long-term interest rates may percolate to influence short-term interest rates via financial plumbing. 

  • The Anatomy of the Gold Crash of April 12-15, 2013 from a Liquidity Perspective – An Application of Donier and Bouchaud’s Measure of Illiquidity

    Source: Daniel Ceferino D. Camagay
    Date Submitted: 26 Sep 2017
    Views: 1053
    Downloads: 11
    Gold crash of April 12-15, 2013 as seen from a liquidity perspective using Donier and Bouchard's measure of illiquidity
  • Global Market Inefficiencies

    Source: Sohnke M. Bartram, Mark Grinblatt
    Date Submitted: 22 Sep 2017
    Views: 1248
    Downloads: 81
    Academic Research Paper
  • China: $ Bond - Why Issue and Where Should It Price? 

    Source: Richard Briggs, Matthew Phan, CFA
    Date Submitted: 10 Sep 2017
    Views: 1298
    Downloads: 0
    • China is reported to be readying a dollar sovereign issue. We expect it to price at the tightest end of the EM external sovereign index, inside highly rated sovereigns including Korea, Hong Kong and Israel. This is thanks to what we expect will be a strong technical bid from Chinese banks.
    • China doesn't have to issue external debt which raises questions about why the sovereign is issuing at this stage. 
    • Credit growth has slowed but remains well above nominal GDP, and there are long term questions about the viability of the investments toward which credit is going. That has left the Chinese economy very imbalanced, but those imbalances are largely domestic. Foreign currency debt remains low, both at a sovereign and whole economy level.
    • China's still extremely high reserves amount to close to double the stock of external debt, both public and private and close to 19 months of imports of goods and services. Reserve drain has also been halted as outflows have been curbed sharply in 2017.
  • Investment Opportunity in Cash Rich Japanese Equity 3: Stronger Support in Japan for Activist Funds Demanding Increase in Shareholder Returns

    Source: Kei Yamaguchi, MM Capital Investments
    Date Submitted: 03 Sep 2017
    Views: 1104
    Downloads: 29
    Japanese regional banks have been suffering from the severe business environment and financial conditions since the 2008 Lehman Crisis. This situation has worsened since the Bank of Japan introduced negative interest rates in 2016.

    On the other hand, Japanese corporations still have not paid sufficient dividends to its shareholders. The dividend payout relative to net profit (Payout Ratio) and capital (DOE) are half or less of leading global markets.

    Shareholder proposals for an increased dividend payout of Japanese corporations are more supportive by large investors including banks in Japan. Another tail wind is the Japanese “Stewardship Code” which seeks for stronger corporate governance and deeper dialogues between corporations and shareholders
  • Harnessing China's Economic Growth

    Source: Vincent Chen
    Date Submitted: 03 Sep 2017
    Views: 234
    Downloads: 0
    ICBC Credit Suisse Vincent Chen, CFA discusses the key growth drivers for China and how the liberalization of China’s capital market impacts global asset allocation.
    Video interview with S&P DJI at the link below:


    http://www.spdji.com/multimedia-center/harnessing-china-s-economic-growth

     
  • State budget 2018: an appropriate dose of caution

    Source: Kahlil Rowter
    Date Submitted: 31 Aug 2017
    Views: 57
    Downloads: 0
    How can Indonesian fiscal policy cope with global uncertainty and a slowing domestic economy? What are the challenges and policy responses so far to debt management?
  • Banking Bad: The China and India Episode

    Source: Jonathan Rochford
    Date Submitted: 31 Aug 2017
    Views: 327
    Downloads: 18
    China and India are both getting excited about creating bad banks. Yet neither has an answer to the key question “who is going to take the loss”?
  • Mergers and acquisitions: how do you view their underlying substance?

    Source: Hong Kong Institute of Certified Public Accountants
    Date Submitted: 30 Aug 2017
    Views: 3014
    Downloads: 78
    Are you a shareholder or analyst with an interest in mergers and acquisitions? 
    The accounting standard-setters need your expertise. 

    We are aware that M&As are common and can take the form of group restructurings or third party acquisitions. There is usually no question that there is underlying substance to acquisitions with third parties - the transaction price typically represents the fair market value of the acquired business. But M&As within a group might arguably be different.

    The findings of this M&A survey will be published and will help us consider whether all M&As should be accounted and reported in the same way. 

    To participate, click on this link: http://survey.hkicpa.org.hk/index.php?sid=57118&lang=en, or download and email us the attached survey: outreachhk@hkicpa.org.hk
  • AAM-CAMRI-CFA Institute Prize - A Protocol for Factor Identification      

    Source: Kuntara Pukthuanthong, Richard Roll, Avanidhar Subrahmanyam
    Date Submitted: 29 Aug 2017
    Views: 92
    Downloads: 0
    Paper Submission for AAM-CAMRI-CFA Institute Prize in Asset Management
     
  • For China, this Time is Different

    Source: Jonathan Rochford CFA
    Date Submitted: 24 Aug 2017
    Views: 370
    Downloads: 13
    In 2008 China announced a massive stimulus package that helped its economy and the global economy weather the storm. But nearly ten years on, the situation is very different and China could shift from being a big contributor to global growth to an anchor slowing down the global economy.
  • Chinese Demand Growth Lifts Every Commodity

    Source: Jodie Gunzberg, CFA
    Date Submitted: 21 Aug 2017
    Views: 1467
    Downloads: 0
    In this article, the impact of Chinese demand growth changes on overall commodities, sectors and individual commodities is examined, using year-over-year data from 1970.
  • EM Weekly: Beta Sell-Off, Asia Least Hard Hit

    Source: Richard Briggs
    Date Submitted: 13 Aug 2017
    Views: 388
    Downloads: 5
    • Risk assets took a bump last week largely due to global, rather than EM, factors. DM underperformed EM in excess return terms. In IG, EM corporates generated excess returns of minus 0.38% versus minus 0.54% on DM. In HY corporates a similar story was true with excess returns of minus 0.44% versus minus 1.12% on DM.  
    •  
    • One of the drivers of the risk off tone last week was the war of words between US President Donald Trump and North Korea's leader Kim Jong-un. That hit the Korean won hardest, it fell 1.64% versus the dollar over the week. Asian currencies were generally weaker last week, with the exception of the Chinese renminbi which strengthened by 0.98%. But in hard currency, the opposite was true with Korean names and sovereign debt generally outperforming IG counterparts.  
    •  
    • In fact the hardest hit last week in the hard currency corporate and sovereign indices were the LatAm and sub-Saharan African credits which are usually caught up in any beta sell off regardless of the driver. Asian names, which tend to be tighter, higher rated and more defensive were the strongest performing last week in that risk-off environment, including Korea.
    •  
    • Notable outliers to those broad moves last week included Teva which continued to sell off for a second week with very high trade volumes persisting after weaker 2Q17 results in the week before last. Teva was down by 1.62% in excess return terms. Venezuela and PDVSA were also among the bottom of the high yield indices' constituents for performance last week and continued to be very volatile, falling on average by 3.32% and 3.69% respectively in price terms last week. Kenya was at the stronger end of the sovereign index last week with excess returns of 0.71%, after relief that last week's elections didn't turn to violence, albeit with the result still being disputed and strikes planned on Monday.
    •  
    • Issuance slowed to a trickle last week with $2.5 bn priced, of which $1.7 bn was rated high yield. The only sovereign new issue was Gabon (B3/B+) which priced a $200 mn tap of its 6.95% 2025 notes. There are several other sovereign new issues being rumoured as coming in the second half of August or early Autumn including Bahrain (euros), $2 bn from Oman and $3 bn from Nigeria.
    •  
  • Emerging from the shadows - The shadow economy to 2025 

    Source: Boon Yew Ng
    Date Submitted: 08 Aug 2017
    Views: 492
    Downloads: 2
    The shadow economy (SE) is expected to decline globally by 2025, from 23% of global GDP in 2011 to an estimated 21% in 2025, on the basis of a mathematical analysis of the factors behind the SE. But the decline is not uniform, and a number of countries, particularly emerging market economies, are expected to experience an increase in the SE as a percentage of GDP by 2025.

    Emerging from the shadows, the shadow economy to 2025 provides a comprehensive examination of the global SE. The report is divided into four sections: SE forecasts for 28 countries to 2025, key factors shaping the SE, the impact and management of the shadow economy and finally recommendations for the accountancy profession
  • The Business of Ethics

    Source: Dr Raymond Madden, CEO
    Date Submitted: 28 Jul 2017
    Views: 1588
    Downloads: 0
    "Restoring the trustworthiness of global business will be a long-haul and there are no short-cuts when it comes to trying to embed ethical behaviour in business DNA.  But the dialogue in global board rooms is beginning to change with the importance of corporate culture, behaviours and the causal links to incentives and rewards gradually being recognised.  Our international businesses will always have responsibilities that go way beyond compliance - you cannot regulate for good behaviour.  Sustainable improvements in culture and behaviour in banking and right across the business landscape can only be achieved if individual institutions, owners, investors and the people leading and managing them step up to the plate.  As Dr Madden's thought provoking book makes clear, responsibility and accountability have to move to the top of every Board agenda".  Dame Collete Bowe, Chairman, UK Banking Standards Board.
  • Monetary Policy Statement Summary, FY'18 

    Source: Mohammad Rehan Kabor , Md. Nazmus Sakib, Tajkera Rahman
    Date Submitted: 26 Jul 2017
    Views: 356
    Downloads: 27
    Monetary Policy Statement (MPS) reports Bangladesh Bank’s (BB) monetary policy outcome for the fiscal year 2017 (FY17) and the monetary policy stance for FY18. As in the past, the FY18 monetary program and the monetary stance for H1 FY18 have been formulated taking into account actual outcome for FY17, internal and external developments, macroeconomic condition and current period budget. This report is a summary regarding last fiscal's achievement along with target and programmed monetary measures for next HY is presented in a concise form here in this attached file. 
  • Fixed-Income Weekly Report, 10th-14th July

    Source: Thanh Truong; Son Nguyen, Thien Viet Securities JSC
    Date Submitted: 19 Jul 2017
    Views: 311
    Downloads: 14

    The market saw the dramatic decline in bond yield of all tenors following rate cut by State Bank of Vietnam (SBV,the central bank). It is amplified by the abundance of VND and low money market (MM) rate. Although bond yields overall were low level, Vietnam State Treasury (VST), the big player in primary market, reduced amount of bond offering when he did not rush in new issuance, in our view stated in last week report “Weekly Report_03072017_07072017”. 

  • Dynamic Relationship between Gold Prices, Oil Prices, Exchange Rate and Stock Returns: Empirical Evidence from Pakistan

    Source: Farhan Ahmed, Muhammad Kashif, Farjad Feroz
    Date Submitted: 17 Jul 2017
    Views: 505
    Downloads: 18
    This study aims to analyze the dynamic relationship between key macroeconomic indicators of Pakistan including gold prices, stock market returns, and exchange rate and oil prices. Significant variations or shocks have been observed over time especially in the past decade among the stated macroeconomic variables. It is essential to validate the relationship between them periodically and this study will help investors who want to diversify their investment into various assets classes including financial assets and real assets.
  • Investment Opportunity in Cash Rich Japanese Equity: Rising Opportunities in the Land of the Rising Sun

    Source: Masashi Murata, Kei Yamaguchi
    Date Submitted: 13 Jul 2017
    Views: 459
    Downloads: 33
    As a result of the “Abenomics” reform, listed Japanese corporations are steadily
    accumulating wealth in the form of cash and other liquid assets since 2013.

    The share price of these cash rich corporations remains undervalued. Nearly half
    of the listed companies in Japan have a PBR of less than 1.0. These undervalued
    corporations have a large potential for a hike in share price.

    In June 2017, the PBR of JASDAQ Japan listed Solekia (9867) soared from 0.3 to
    1.2 in less than six months. The new “Stewardship Code” introduced in 2014 forces
    stronger corporate governance in Japan. Since 2014, there have been significantly
    stronger shareholder dialogues thus expanding investment opportunities.
  • Interest in ESG Investing Poised to Grow Further in Asia Pacific

    Source: Chan Fook Leong, CFA
    Date Submitted: 10 Jul 2017
    Views: 2399
    Downloads: 0
    • CFA Institute further extends ARX ESG Investing Series to Singapore to discuss motivations for ESG integration in the region.
    • Panelists from S&P Dow Jones Indices, City Developments Ltd., ADL Infra Capital Myanmar, and ESGuru spoke to a full house of CFA Institute members and local practitioners on developments in green finance.
    • Participants concluded that despite challenges, green finance would continue to attract investor interest; supply of green instruments needs to catch-up.
    • Social and governance considerations still in their infancy in the region.
    • The question of alpha potential inconclusive.
    Dr. Tony Tan, CFA, head, global society advocacy engagement at CFA Institute kicked off the May 11, 2017 lunch-time talk entitled ‘Is green finance a fad? Or does it possess alpha potential?’ The event, organized by CFA Institute and CFA Society Singapore follows the first of the ARX ESG Investing Series, hosted in Hong Kong. This series has been developed in response to demand for ESG-related research on research platform, Asia-Pacific Research Exchange (www.arx.cfa).
     
  • Mid-Year Research Update 2017: Active managers performance, factor-driven, ESG, and fixed income indices

    Source: Craig J. Lazzara, Priscilla Luk, Sunjiv Mainie, Charles Mounts, Aye M. Soe
    Date Submitted: 07 Jul 2017
    Views: 1464
    Downloads: 34
    Published in May 2017, this research reveals most active managers fail most of the time, at least if we define failure as underperformance of an appropriate passive benchmark. Success, when it does occur, tends not to persist.
  • APER - Under Deployed

    Source: CAPER
    Date Submitted: 04 Jul 2017
    Views: 220
    Downloads: 2
    Key Points
    • Private equity capital is under deployed in Asia. The US$127.2 bn in transaction volume in 2016 represents only 0.48% of Asia’s GDP; whereas in the US, it was more than 1%

    • Asia has room to absorb over US$130 bn of capital deployment from private equity

    • In the 10 years from 2007 to 2016, China’s GDP has nearly tripled, but private equity investment, as a percentage of its GDP, on average, accounted for 0.3% of the country’s economic output

    • Australia/New Zealand enjoys the highest percentage of private equity capital deployment, at 2.5% of its GDP in 2016, suggesting that a market with a mature private equity infrastructure is a magnet for capital 
  • Bangladesh National Budget (Update) 

    Source: EBLSL Research Team
    Date Submitted: 02 Jul 2017
    Views: 428
    Downloads: 30
    This report demonstrates latest update on Bangladesh National Budget Review for Finance Bill-2017. Earlier on 1st June, 2017, we provided a budget review based on the budget proposal, placed by finance minister. The Parliament passed the final budget on 29th June, 2017 with some changes from the proposed one and here in this report we presented the changes in the Finance Bill- 2017 along with some observations in a concise manner.
  • Joint Feasibility Study on China-Georgia Free Trade Agreement

    Source: PMC Research Center, University of International Business and Economics (UIBE)
    Date Submitted: 27 Jun 2017
    Views: 530
    Downloads: 5
    China and Georgia are friendly countries. In 1991, China recognized the independence of Georgia -- among the first countries to recognize the independence of Georgia and established diplomatic relations. In 1992, China established diplomatic relations with Georgia. After twenty years of close interactions of leaders and people, fruitful cooperation in various fields is achieved.

    In 1993, relevant government departments of China and Georgia signed several agreements, such as economic and trade agreement, agreement on encouragement and mutual protection of investments, scientific and technical cooperation agreement, agreement on cultural cooperation, health and medical science cooperation agreement, cooperation agreements in agriculture and food industry, tourism cooperation agreements, customs mutual assistance agreement, inter-bank cooperation agreement, and the development of railway transport cooperation agreement and maritime cooperation agreements. In 1994, the two countries signed the "mutual exemption of visas for official travel and group travel visa-free mutual agreement", "China agreement to provide 30 million yuan commodity loans to Georgia." In 1999, the two countries agreeed in Tbilisi Georgia to establish a Commission on Economic and Trade Cooperation, and held the first meeting. China is always a friend of Georgia. In September 2013, during a visit to Kazakhstan, President Xi Jinping proposed the "Silk Road economic belt" strategic vision, enthusiasticly responded by many countries including Georgia. On March 9, 2015, the Chinese Ministry of Commerce and the Ministry of Sustainable Development of Georgia agreed to establish a joint working group on trade to study feasibility of China-Georgia Free Trade Agreement. The two sides also signed a memorandum on strengthening "Silk Road economic belt" to jointly promote economic and trade cooperation, and to enhance trade, investment, economic and technical cooperation and infrastructure interconnection level. To start a free trade agreement feasibility study for the two sides, serves as an important initiative to strengthen "Silk Road economic belt", which will reinvigorate bilateral economic and trade relations for the two countries.

    Georgia and China intend to intensify the trade and economic relations through creating free trade agreement. The goal of the report is to evaluate the potential, ex-ante effects of free trade agreement on existing trade flows and identify the specific areas of interest for further cooperation. The Research component of the report include the methodology and discuss some effects of differences in methodologies used by Georgian and Chinese experts, data description, detailed results of simulations and sensitivity analysis of parameters and discuss the specific sectors for potential augmentation of cooperation.

    This report seeks to analyze the potential benefits and challedges of a potential China-Georgia free trade agreement. It involves the study of foreign economic situation between the two countries, in particular, through analyzing foreign economic policies and bilateral economic and trade relations, investigating issues related to trade in goods, trade in services and investments. Based on that, solid scientific suggestions will be given to guide the potential free trade agreement negotiations.

    The objectives of the study are:
    - To provide background information to commence negotiations on CGFTA.
    - Identify specific products sectors for expansion and diversification of trade between the parties.
    - Identify the benefits and challenges that may derive from the proposed FTA.
    - To make conclusions and recommendations on options for future action including scope, framework and architecture and FTA for furthering bilateral trade investment and economic cooperation to expand and enhance the benefits in these areas.
  • PBOC Monthly: Onshore Corporate Bonds - Dead or Alive?

    Source: Matthew Phan, CFA
    Date Submitted: 22 Jun 2017
    Views: 1803
    Downloads: 26
    • Local government bond issuance has roared back to life but corporate bond financing saw the largest monthly net decline since at least 2011. Other non-bank financing was also weak in May, with outstanding entrusted loans and undiscounted bills falling on a net basis. 
    • Bank lending rose by 12.8% YoY and was the main driver of social financing growth which grew 13.0%. Household loan growth peaked in April and decelerated slightly to 24.3% YoY in May. There are multiple reports of tighter controls on the housing market, though there is not yet specific data on mortgage lending for May. Corporate loan growth picked up further to 8.5%. 
    • The weak corporate bond market is a major risk for economic growth and for corporate credit quality.  The PBOC could inject liquidity to bring down short term rates, which should reopen the bond market, but this means shifting the focus away from 'deleveraging' and might also risk renewed concerns over capital outflows. China has enjoyed relative external stability this year but this could change if the USD strengthens as and when US inflation and rates pick up or as the Fed commences plans to reduce its balance sheet. 
    • Refinancing costs have risen by over 100 bp on short dated commercial paper issued in 2015-16 when yields were low. They have risen by less on longer-dated bonds issued prior to 2015. There is some RMB 1.4 bn of commercial paper due to mature in the remaining months of 2017, with the largest issuance from the manufacturing, utilities and mining sectors.
    • Issuers of longer-dated bonds might not face a big increase in refinancing costs but could instead face the risk of being entirely unable to issue. The real estate sector in particular has a sizable amount of bonds coming due or turning putable in the remaining months of 2017 but gross issuance has been negligible in the last few months due to regulatory restrictions. Other sectors with large amounts of issuance coming due include manufacturing, conglomerates, construction and mining. 
  • 2016: A Quantum Leap for Indian Corporate Bond Market

    Source: Shagun Thukral, CFA
    Date Submitted: 20 Jun 2017
    Views: 3428
    Downloads: 52
    This paper was published in the Research Bulletin, The Institute of Cost Accountants of India, Vol. 43, No.I, April 2017 issue.  The paper seeks to establish 2016 as a turning point in the development of the corporate bond market in India while identifying the factors, using the RBI's 7i Framework, that have contributed to this push and where there remains room for further improvement.
  • Divided we fall, distributed we stand. - The professional accountant’s guide to distributed  ledgers and  blockchain

    Source: Narayanan Vaidyanathan
    Date Submitted: 20 Jun 2017
    Views: 654
    Downloads: 0
    A distributed or shared ledger is a digital database of records. These records contain information relevant to a group of participants within a network.

    In a distributed ledger all participants are looking at a common view of the records. This is in contrast to a typical situation currently where participants (for example, in different organisations) are looking at different databases that are independently managed and updated.

    As Distributed Ledger Technology (DLT) matures, the shared ledger’s common view of records and transparency of transaction history could reduce reconciliation across different databases and drive significant efficiencies. Business processes that are characterised by inefficiencies (eg trade finance), or exist because of a lack of trust (eg Know Your Customer requirements in financial services) or poor supply chain visibility (eg for global garment supply chains) are all key areas for distributed ledger applications.

    This report introduces and explores the concept of distributed ledgers, examines its commercial potential and how this relates to different aspects of professional accountancy.
  • Fintech - Transforming Finance

    Source: Jimmy Greer
    Date Submitted: 20 Jun 2017
    Views: 920
    Downloads: 0

    Financial Technology (FinTech) is here – sweeping through finance and, if some are to be believed, threatening traditional edifices that have stood for centuries.

    This great surge is being fronted by a host of new start-ups taking their lead from the big tech innovators. Their maverick approach is helping to push the FinTech industry into new territory across the financial services landscape, raising billions of dollars and worrying the incumbents.

    So what are the main trends and driving forces shaping FinTech today? Fintech – transforming finance explores the features of this new landscape, highlighting the many ways in which this revolution is taking place.

    For professional accountants, this new terrain will provide many opportunities as it permeates deeper and deeper into the fabric of society. From the promise of blockchain, to the demands of valuation in a digital era, finance more than ever needs an experienced, knowledgeable guide to make the most of the opportunities ahead.

  • Budget Analysis FY 2017-18

    Source: BRAC EPL Research
    Date Submitted: 06 Jun 2017
    Views: 440
    Downloads: 35
    The Finance Minister proposed the budget for FY2017-18 on 1st June, 2017. After stepping back in last two years, the government has finally implemented a single and uniform VAT rate of 15.0% across all sectors (including services) - to be effective from July 01, 2017. Apart from this development, only a few other notable policy changes have been proposed in this budget with limited implications for the private sector players including listed companies and capital market, in general.
  • What next after the S&P ratings upgrade?

    Source: Kahlil Rowter
    Date Submitted: 05 Jun 2017
    Views: 361
    Downloads: 0
    Indonesia was recently upgraded by S&P to investment grade, after a 20-year hiatus. What were the rationales behind the upgrade, and what will follow next as a consequence?
  • Bangladesh National Budget Review FY'18

    Source: EBLSL Research Team
    Date Submitted: 04 Jun 2017
    Views: 1089
    Downloads: 136
    The 46th National Budget of Bangladesh and 11th by Finance Minister AMA Muhith has been proposed on 1st June, 2017. Proposed budget size for FY ’18 is BDT 4002.66 bn which is 18.0% of GDP. This is the largest budget in the history of Bangladesh. Target Revenue is BDT 2879.91 bn caused a deficit amounting to BDT 1122.75 bn which will be financed through domestic sources (BDT 603.52 bn) and External Borrowings (BDT 519.24 bn).
     
  • Oil Price Shocks on the Industry Level Production Using Vector Auto Regression: Empirical Evidence from Pakistan

    Source: Farhan Ahmed, Osama Daudpota, Muhammad Kashif
    Date Submitted: 31 May 2017
    Views: 439
    Downloads: 5
    Industrial production is one of the leading indicators of gross domestic product and economic growth of the country which reflects the overall economic performance of a country. In other words decreases or increases in industrial production point out a contracting or expanding economy. Therefore, changes in prices of oil are the crucial inputs to the overall industrial production. This study examines the effects of oil prices shocks on the industrial production in Pakistan during the period July 2000-June 2015 by using VAR model. This research has shown that oil price shocks had a negative impact on industrial production in Pakistan to some extent. It is recommended to forecast oil prices for future that can help take precautionary steps to be flexible enough to control the impact on industrial production level. 
  • Stock Market Market Crash of 2008: an empirical study of the deviation of share prices from company fundamentals

    Source: Taisei Kaizoji, MIchiko Miyano,
    Date Submitted: 06 May 2017
    Views: 415
    Downloads: 32
    The aim of this study is to investigate quantitatively whether share prices deviated from company fundamentals in the stock market crash of 2008. For this purpose, we use a large database containing the balance sheets and share prices of 7,796 worldwide companies for the period 2004 through 2013. We develop a panel regression model using three financial indicators–dividends per share, cash flow per share, and book value per share–as explanatory variables for share price. We then estimate individual company fundamentals for each year by removing the time fixed effects from the two-way fixed effects model, which we identified as the best of the panel regression models. One merit of our model is that we are able to extract unobservable factors of company fundamentals by using the individual fixed effects. Based on these results, we analyze the market anomaly quantitatively using the 
    divergence rate–the rate of the deviation of share price from a company’s fundamentals. We find that share prices on average were overvalued in the period from 2005 to 2007, and were undervalued significantly in 2008, when the global financial crisis occurred. Share prices were equivalent to the fundamentals on average in the subsequent period. Our empirical results clearly demonstrate that the worldwide stock market fluctuated excessively in the time period before and just after the global financial crisis of 2008. 
  • The Reflation Trade Is Over; Get Set for Defensive Rotation

    Source: Hao Hong, CFA
    Date Submitted: 10 Apr 2017
    Views: 1465
    Downloads: 6
    This research appears on WenXin's blog "Hong Hao China Strategy" on 6 March 2017.
  • Analyst Report - Best World International Ltd

    Source: Charles Phan Zhong Wei, Jeremy Liang Jinrong, Ai Xin
    Date Submitted: 27 Mar 2017
    Views: 454
    Downloads: 45
    Sell-side research report on Best World International Ltd. Initiate a Buy Call with upside of 47.7%. Includes: - detailed report of analysis - slide deck to pitch the stock recommendation - financial model with detailed accounting adjustments, performance analysis, forecasts and valuations
  • 2017 Market Outlook - Charting New Course

    Source: Thien Viet Securities JSC
    Date Submitted: 07 Mar 2017
    Views: 377
    Downloads: 18
    1. Economy Outlook – Charting New Course • We expect 2017 economy delivers 6.41% growth (vs. 6.7% government target) with controlled inflation under 7%. • Although the monetary policy has more room (the Taylor rule rate of 5.43% vs. 9% base rate), the new cabinet is expected not to take use of it. • 3.5% fiscal deficit is stretched target which requires government follow strictly financial discipline. • Uncertain global trade weights on both trade and foreign exchange. 2. Equity Market – Approaching to Next Bar • Given economic stabilization, we expect the VNindex enjoying 10.3% growth to price at 732.23. It does imply 2016 P/E traded at forward 14.45x. • Market movement gains momentum from new large-cap listings expected speeding up in 2017 . The new cabinet takes SOE-equitization plan seriously when public debt approaching to 60% GDP. • Foreign trading expected to be net-selling when selling forces does exist, explained by (i) hiking Fed rate, (ii) closing 10-year investment horizon fund since inception of 2007, and (iii) ETF being less attractive vehicle. 3. Our favorable sector/stock • Consumer goods sector [portfolio’s growth component] - backed by rising tide of private consumption. Our stock picks are VNM, PNJ and MWG. • Oil & Gas [portfolio’s alpha-generation component] – 2017 turnaround year. Our stock coverage are PVD and DCM. • Real Estate – Time to Enter Affordable Housing Segment. Our stock coverage is NLG • New listing - Short-term event-driven strategy. Our stock pick is VJC.
  • Dynamic Transition of the Exchange Rate Regime in the People's Republic of China

    Source: Yoshino, Naoyuki , Kaji, Sahoko, Asonuma, Tamon
    Date Submitted: 27 Feb 2017
    Views: 449
    Downloads: 5
    Yoshino, Naoyuki; Kaji, Sahoko; Asonuma, Tamon | April 2014
  • How Far Can Renminbi Internationalization Go?

    Source: Yongding, Yu
    Date Submitted: 27 Feb 2017
    Views: 634
    Downloads: 4
    Yongding, Yu | February 2014
  • The More Divergent, the Better? Lessons on Trilemma Policies and Crises for Asia

    Source: Aizenman, Joshua, Ito, Hiro
    Date Submitted: 27 Feb 2017
    Views: 86
    Downloads: 1
    Aizenman, Joshua; Ito, Hiro | June 2014
  • Stock Market Co-Movement and Exchange Rate Flexibility: Experience of the Republic of Korea

    Source: Park, Yung Chul, Park, Hail
    Date Submitted: 27 Feb 2017
    Views: 457
    Downloads: 3
    Park, Yung Chul; Park, Hail | May 2014
  • Asian Monetary Integration: A Japanese Perspective

    Source: Kawai, Masahiro
    Date Submitted: 27 Feb 2017
    Views: 350
    Downloads: 1
    Kawai, Masahiro | April 2014
  • Exchange Rate Pass-Through To Domestic Prices: Evidence from Pakistan

    Source: Farhan Ahmed, Syed Muhammad Ahsan Hussain
    Date Submitted: 21 Feb 2017
    Views: 449
    Downloads: 0
    Exchange Rate - Pass Through is the phenomena that explains to what extent the movements in exchange rate affect macroeconomic variables of any country. This paper analyses the movements of exchange rate that has affected on wholesale price index, consumer price index, large scale manufacturing, fuel and lightening and the growth of money supply. The data from June 2005 to June 2011 is analyzed by using the econometric framework. In this study, the results of impulse response have shown that impact of exchange rate pass through is high on WPI and low on CPI. The results of variance decomposition is as much as the 5.48%. For the WPI, the variance decomposition is as much as 10.15% and the other variations are explained by the other independents variables.
  • Purchasing Power Parities and Real Expenditures

    Source: Asian Development Bank
    Date Submitted: 16 Feb 2017
    Views: 442
    Downloads: 3
    Asian Development Bank | June 2014
  • Impact of elections on stock price graph: a case of US elections

    Source: Shreya Sethi, Shreya Sethi
    Date Submitted: 09 Feb 2017
    Views: 213
    Downloads: 5
    This paper focuses on the impact of US presidential elections on stock market. Thus, this paper aims to analyse the impact of the US presidential elections that have taken place from 1980 to 2010, on the stock market performance for eight different industries. The paper puts special emphasis on studying the abnormality of return related to stock prices and evaluating the uncertainty between the firm’s tax policy and stock market, around the time of upcoming presidential elections. This is a comparative study wherein the effects of pre- and post-election have been assessed. The empirical analysis undertaken relies on secondary data collected from various online sources. The results of the papers highlight; industry return data churn out ambiguous results when compared for winning election party. Also, the rate of reaction tends to differ grossly with respect to different industries. Democratic victory impacts the stock return negatively but in case of Republican victory the result is insignificant. A positive correlation exists between abnormal stock price and firms’ marginal tax rate around the day of the election. The paper proves there is a transitional effect of election, felt in the stock market irrespective of the anticipated outcome of the election.
  • Trilemma Challenges for the People’s Republic of China

    Source: Kawai, Masahiro, Liu, Li-Gang
    Date Submitted: 06 Feb 2017
    Views: 114
    Downloads: 0
    Kawai, Masahiro; Liu, Li-Gang | January 2015
  • Dynamic Effect of a Change in the Exchange Rate System: From a Fixed Regime to a Basket-Peg or a Floating Regime

    Source: Yoshino, Naoyuki, Kaji, Sahoko, Asonuma, Tamon
    Date Submitted: 04 Feb 2017
    Views: 369
    Downloads: 2
    Yoshino, Naoyuki; Kaji, Sahoko; Asonuma, Tamon | March 2015
  • Asian Development Bank and Azerbaijan: Fact Sheet

    Source: Asian Development Bank
    Date Submitted: 04 Feb 2017
    Views: 92
    Downloads: 1
    Asian Development Bank | April 2015
  • Financial Development, Financial Openness, and Economic Growth

    Source: Estrada, Gemma, Park, Donghyun, Ramayandi, Arief
    Date Submitted: 03 Feb 2017
    Views: 135
    Downloads: 1
    Estrada, Gemma; Park, Donghyun; Ramayandi, Arief | August 2015
  • Public Debt Sustainability in Developing Asia: An Update

    Source: Ferrarini, Benno, Ramayandi, Arief
    Date Submitted: 03 Feb 2017
    Views: 86
    Downloads: 0
    Ferrarini, Benno; Ramayandi, Arief | December 2015
  • A Darwinian Perspective on “Exchange Rate Undervaluation”

    Source: Du, Qingyuan, Wei, Shang-Jin
    Date Submitted: 03 Feb 2017
    Views: 371
    Downloads: 1
    Du, Qingyuan; Wei, Shang-Jin | October 2015
  • The Impact of Financial Factors on the Output Gap and Estimates of Potential Output Growth

    Source: Felipe, Jesus , Sotocinal, Noli, Bayudan-Dacuycuy, Connie
    Date Submitted: 03 Feb 2017
    Views: 352
    Downloads: 1
    Felipe, Jesus; Sotocinal, Noli; Bayudan-Dacuycuy, Connie | October 2015
  • Commercial Bank Innovations in Small and Medium-Sized Enterprise Finance: Global Models and Implications for Thailand

    Source: Subhanij, Tientip
    Date Submitted: 02 Feb 2017
    Views: 2244
    Downloads: 20
    Subhanij, Tientip | July 2016
  • Capital Inflow Surges and Consequences

    Source: Ghosh, Atish R., Qureshi, Mahvash S.
    Date Submitted: 01 Feb 2017
    Views: 292
    Downloads: 3
    Ghosh, Atish R.; Qureshi, Mahvash S. | July 2016
  • Should the RBA be Worried About the Labour Market

    Source: Jimmy Louca
    Date Submitted: 28 Dec 2016
    Views: 233
    Downloads: 0
    The Reserve Bank of Australia (RBA) will ponder two important releases when its Board meets in November: this week’s employment report and next week’s Q3 Consumer Price Index (CPI). On first blush, the labour market appears in good health. This week showed that the unemployment rate fell to 5.6% in September, a three-year low and down on a recent peak of 6.3% just last July. However, we argue that on broader measures the labour market has lost momentum and that this would be of increasing concern to the RBA.
  • Active Currency: A Vital Diversifier in a Low Yield World Part 1

    Source: QIC
    Date Submitted: 27 Dec 2016
    Views: 240
    Downloads: 0
    There weren’t many winners from the washout of the 2008 financial crisis, but as the efficient market theory floundered, Keynesian economic policy re-emerged to steady the ship. Easy money sloshed through the US economy and before long other countries were following suit.
  • Some Preliminary Evidence on Stock Price Bubbles in an Emerging Market

    Source: Nawazish Mirza, PhD, Ayesha Afzal, PhD
    Date Submitted: 06 Dec 2016
    Views: 467
    Downloads: 0
    This paper analyzes the presence of a speculative component during the extra ordinary upsurge in Karachi Stock Exchange. We implement cointegration tests, between 1997 and 2008, on price and dividends of various market and sectoral indices. The no bubble hypothesis could not be rejected for market level indices establishing the presence of a speculative factor. Among sectoral indices, banking sector depicted a speculative component, however, the price level of Oil and Gas sector did not diverge from the related dividends. These results remained robust with evidence of persistent volatility shocks for the sample period.
  • Interest Rate Spreads in an Emerging Economy: The Case of Pakistan’s Commercial Banking Sector

    Source: Nawazish Mirza, PhD, Ayesha Afzal, PhD
    Date Submitted: 25 Nov 2016
    Views: 446
    Downloads: 0
    This paper explores the determinants of interest rate spreads in Pakistan’s commercial banking sector in post transition period (2004 – 2009) using an exhaustive set of macro and firm level variables to analyze their impact on intermediary efficiency. We introduce two innovative variables of default likelihood indicator (Black Merton and Scholes option pricing framework) and proportion of public sector deposits in total deposits to explain the variation in spreads. The results suggest that intermediary efficiency is affected by bank size, operational efficiency, asset quality, liquidity, risk absorption capacity and GOP growth rate. There is evidence for deposit market share as well as deposit market concentration establishing the presence of an interest sensitive deposit market. We could not find support for impact of interest rate volatility and financial development indicator on banking spreads.
  • Volatility Dynamics in an Emerging Economy: Case of Karachi Stock Exchange

    Source: Mahreen Mahmud, PhD, Nawazish Mirza, PhD
    Date Submitted: 25 Nov 2016
    Views: 274
    Downloads: 0
    The paper aims to model and forecast the volatility in the stocks traded at the Karachi Stock Exchange before and during the recent financial crisis using the GARCH, EGARCH and GJR-GARCH models. We find the stock return volatility to be characterized by clustering and displaying asymmetries. Results point to the capability of the EGARCH(1,1) model at forecasting for both periods lending support to the use of GARCH family of models for emerging markets during crisis. We find evidence for a synthetically constructed index based on trading volume capturing the volatility structure of the market as well as that based on market capitalization which has important implications for investors.
  • Detailed report on Textile sector in Pakistan

    Source: The Pakistan Credit Rating Agency Limited
    Date Submitted: 24 Nov 2016
    Views: 319
    Downloads: 20
    Detailed report on Textile sector in Pakistan
  • Inflation volatility: An Asian Perspective

    Source: Kumail Rizvi, Phd, CFA, FRM, Bushra Naqvi, PhD, FRM, Christian Bordes, PhD, Nawazish Mirza, PhD
    Date Submitted: 24 Nov 2016
    Views: 578
    Downloads: 0
    For the quarterly data of 10 Asian economies, ranging from the first quarter of 1991 to last quarter of 2012, we model inflation volatility as a time varying process through different symmetric and asymmetric GARCH specifications. We also propose to model inflation volatility on the basis of cyclic component of inflation obtained from an Hodrick Prescott (HP) filter instead of actual inflation when the latter does not fulfil the criterion of stationarity. Through news impact curves (NICs) we tried to highlight the behaviour of inflation volatility in response to lagged inflation shocks under different GARCH specifications. In our results the leverage parameter shows the expected sign and is significant for almost all countries suggesting strong asymmetry in inflation volatility. The hyperbolic sign integral shape of NICs based on Glosten-Jagannathan-Runkle GARCH (GJR-GARCH) highlights the importance of inflation stabilisation programmes particularly because of the subsequent evidence obtained in favour of bidirectional causality running between inflation and inflation volatility. There is also evidence in favour of the argument that a cyclic component of inflation obtained through an HP filter could be used as a suitable proxy of inflation for volatility estimation.
  • AFBC - Slack-based directional distance function in the presence of bad outputs: Theory and Application to Vietnamese Banking

    Source: Manh D. Pham, Valentin Zelenyuk
    Date Submitted: 15 Nov 2016
    Views: 505
    Downloads: 7
    Slack-based directional distance function in the presence of bad outputs: Theory and Application to Vietnamese Banking
  • Global Asset Allocation Trends

    Source: Aaron Low, CFA
    Date Submitted: 14 Nov 2016
    Views: 706
    Downloads: 16
    2016 CFA China Conference
  • Influence of Turbulent Macroeconomic Environment on Productivity Change of Banking Sector: Empirical Evidence from India

    Source: Dipasha Sharma
    Date Submitted: 08 Nov 2016
    Views: 2201
    Downloads: 0
    This study aims to assess the direct impact of US subprime crisis and turbulent macroeconomic conditions on the productivity gains of Indian banking sector using non-parametric data envelopment analysis (DEA) based Malmquist productivity index (MPI) and panel data regression model for the period 2000–2010. This study evaluates the trend of productivity change and assesses the influence of turbulent macroeconomic environment and financial crisis along with regulatory/microeconomic factors on the productivity of the Indian banking sector. The results reveal overall productivity increase during the period under study with the technological improvement across the sector. Financial crisis 2008–2009 exhibits positive and significant impact on the productivity Indian banking sector. Empirical findings suggest that the Indian banking industry sustained their productivity growth even during the global crisis. GDP and inflation exhibits negative and significant association with the productivity gains of Indian banking sector. Productivity growth exhibits significant and positive association with the listing in the stock exchange and therefore this study supports the ‘market discipline’ hypothesis in Indian banking sector. Bank size in terms of total assets, bank’s diversification strategy and profitability exhibit insignificant relationship whereas bank’s expense preference behaviour reveals negative relationship. Bank origin exhibits insignificant association and ownership reveal positive association. Therefore, results of the study do not support global advantage hypothesis in Indian banking sector.
  • HKUST Risk Management and Business Intellegence (RMBI) Newsletter Issue 7

    Source: Chow Miu Lam, Hui Sin Hang, Tsang Wing Wah, Lee Kwok Ho, Tam Kiu Fai
    Date Submitted: 07 Nov 2016
    Views: 389
    Downloads: 0
    Risk Management in the Medical Sector. Risk Management can bring a better decision making and reduce the number of errors, so as to ensure a high quality and effective service being provided. In the past 20 years, the hongkong Hospital Authority (HA) showed great support to develop large scale computer-based systems to manage and reduce the risk within the healthcare sector. To have a deeper understadning on how the systems work, we have invited Dr. CP Wong, Chairman of Society of Medical Informatics Ltd to share with us the success and benefits in risk managment in Hong Kong public hospitals. Safety and Risk Managemnt in the Railway Industry. As an industry with over 15,000 employees, the railway industry is inevitably at risk for human mistakes, leading to a need for risk management measures to reduce operational errors in order to achieve its customer pledge. Let's examine this under serveral issues: benmarking, drivers' training and selection, and risk management and risk identification.
  • HKUST Risk Management and Business Intellegence (RMBI) Newsletter Issue 8

    Source: Wong Yuen Man, Wong Cheuk Fun
    Date Submitted: 07 Nov 2016
    Views: 440
    Downloads: 0
    Humans always learn from history and our students should also learn from the past. This is the first time a case study is used as the main topic in the RMBI Newsletter series.London Whale Risk in 2012 is chosen as the topic of this chapter. This issue mainly focuses on the risks involved, including operational risks, analysis of VAR modeling aswell asthe influence of the Basel regulatory stan­ dard.
  • Crises and Central Banks

    Source: Ishwar Chidambaram
    Date Submitted: 02 Nov 2016
    Views: 3725
    Downloads: 288
    A post-crisis look at the increasingly fragmented monetary policies of global Central Banks and the implications for Main Street
  • AFBC - The Effect of Monetary Policy on Bank Wholesale Funding

    Source: Hyun-Soo Choi, Dong Beom Choi
    Date Submitted: 20 Oct 2016
    Views: 515
    Downloads: 6
    AFBC-The Effect of Monetary Policy on Bank Wholesale Funding
  • Review of factors constraining the development of Indian corporate bond markets

    Source: Shagun Thukral, CFA, Sharada Shridhar, Dr. Medha Joshi
    Date Submitted: 12 Oct 2016
    Views: 983
    Downloads: 14
    This paper is a literature review of papers on the development of corporate bond markets in India. It was published by Emerald in the Qualitative Research in Financial Markets journal in November 2015.
  • Analyst Report - Sheng Siong Group - Oct 15

    Source: Sylvester Yeo, Nicholas Han, Darren Toh
    Date Submitted: 11 Oct 2016
    Views: 589
    Downloads: 28
    Research report on Sheng Siong Group Ltd dated Oct 2015 initiating a hold call
  • Analyst Report - Starhub (Oct 15)

    Source: Sylvester Yeo, Cheng Jun Song, Kenny Tay, Lim You Jie, Sarah Leong,
    Date Submitted: 11 Oct 2016
    Views: 586
    Downloads: 17
    Research report on Starhub dated October 2015 with a sell call
  • Frontier Special Report - Why we are not worried about Brexit

    Source: Frontier Research
    Date Submitted: 28 Aug 2016
    Views: 340
    Downloads: 9
    A critical analysis of the impact the result of the Brexit vote would have on Sri Lanka's Economy.
  • China Market Strategy: Consolidation

    Source: Hao Hong, CFA
    Date Submitted: 21 Aug 2016
    Views: 303
    Downloads: 8
    This article appear on WenXin's blog "Hong Hao China Strategy" on 22 August 2016. Chinese Version: https://www.arx.cfa/post/x-1709.html
  • 中国市场策略: 市场盘整

    Source: Hao Hong, CFA
    Date Submitted: 21 Aug 2016
    Views: 309
    Downloads: 18
    This article appear on WenXin's blog "洪灝的中国市场策略" on 22 August 2016.
  • Business dynamics, efficiency, asset quality and stability: The case of financial intermediaries in Pakistan

    Source: Nawazish Mirza, PhD, Birjees Rahat, Krishna Reddy, PhD
    Date Submitted: 18 Aug 2016
    Views: 422
    Downloads: 0
    This research is aimed at assessing the possible differences in business dynamics, cost efficiency, asset quality and financial stability of conventional, Shariah compliant banks and non-banking financial institutions (NBFIs) in Pakistan, using an unbalanced panel between 2005 and 2013. Theoretically, these three financial intermediaries should demonstrate differences in various business attributes. However, we observe fewer than expected differences between conventional and Islamic banks. We report that Islamic banks have superior asset quality and financial stability than conventional banks. However, certain similarities are present in their respective business models. On the contrary, NBFIs demonstrate differences in business dynamics, with high fee based income and non-deposit funding, as compared to conventional banks. Due to higher business risk and variance in profitability, we find that NBFIs are financially more fragile, irrespective of their stronger capitalization, as compared to commercial banks
  • Frontier Insights - PE Ratio Vs. Interest Rates

    Source: Frontier Research
    Date Submitted: 24 Jul 2016
    Views: 792
    Downloads: 15
    This report explores the relationship between stock market valuations in Sri Lanka and movements in Interest rates. Key FIndings • PER and interest rates are often inversely related: Low interest rates mean lower returns on fixed income, which often increases demand for equity, leading to higher PER valuations • When comparing PER across countries it is also necessary to consider their respective interest rates • Lower PER valuations could be a result of high interest rates, and vice versa
  • Exploring Harrod Domar & Solow models of economic growth

    Source: Shreenivas Kunte, Om Damani
    Date Submitted: 12 Jul 2016
    Views: 602
    Downloads: 10
    From System Dynamics 2016, Conference Proceedings.
  • 脱欧后,如何交易中国(中文版)

    Source: Hao Hong, CFA
    Date Submitted: 30 Jun 2016
    Views: 481
    Downloads: 12
    This article appear on WenXin's blog "洪灝的中国市场策略" on 28 June 2016.
  • Post Brexit: How to Trade China

    Source: Hao Hong, CFA
    Date Submitted: 30 Jun 2016
    Views: 746
    Downloads: 35
    This article appear on WenXin's blog "Hong Hao China Strategy" on 27 June 2016.
  • Domestic Debt Market in India

    Source: Dr. Vighneswara Swamy, Professor of Finance, IBS-Hyderabad, India
    Date Submitted: 23 Jun 2016
    Views: 826
    Downloads: 23
    As India is projected to be the world’s most populous country by 2025, the growing needs of the economy, with expanding population, in the recent years have placed intense stress on physical infrastructure. In order to meet the deficit in the provision of infrastructure, mid-term appraisal of the twelfth plan suggests that to attain 9 percent real Gross Domestic Product (GDP) growth rate, infrastructure investment should be on average almost 10 percent of GDP during the Twelfth Plan which translates into INR 65795 billion (about One trillion dollar). Though there has been a progressive involvement of the private sector in infrastructure investments, the government has to play a proactive role in developing a well-structured platform for raising the required investments in Indian infrastructure. Given the huge demand of US$ 1 trillion for infrastructure investments during the 12th plan period, there is a greater emphasis on creating a domestic debt market with special focus on bond market as an alternate source of funding for bank finance, which is faced with myriad problems of stress assets, asset restructuring, etc.
  • The Respond of Sovereign CDS Market to Macroeconomics Indicators in Crisis and Non-Crisis

    Source: Chanoknun Wutthinitikornkij
    Date Submitted: 21 Jun 2016
    Views: 424
    Downloads: 4
    The respond of domestic and the spillover effect of macroeconomics indicators from the major economies, U.S., Eurozone and China, on sovereign credit default swap (CDS) spread and volatility have been examined on seventeen countries over both financial instability and normal period from January 2008 to December 2015. The paper found that the better than expected announcement tends to reduce the CDS spreads, while the worse than expected one exhibits the opposite effect over both normal and crisis period. The announcement from three major economies has stronger spillover effect on other sovereign CDS market in the financial turmoil comparing to the normal period. The reaction on the volatility from both domestic and major countries is consistent with the expectation that better than expected announcement is likely to reduce the level of volatility, while the worse than expected one show the opposite effect over both normal and crisis period. Similar to CDS spread respond, the volatility tends to be more sensitive from both good and bad news in crisis.
  • Elephant vs. Dragon: The Political and Economic Prospects of India and China

    Source: Gregg S. Fisher, CFA
    Date Submitted: 21 Jun 2016
    Views: 670
    Downloads: 4
    This is a blog posted on CFA Institute's website on 9 July 2014.
  • “India Does Not Need to Learn Capitalism from the West,” Says Lord Desai Share on Facebook Share on Twitter Share on LinkedIn Share via E-Mail

    Source: CK Lee, CFA
    Date Submitted: 20 Jun 2016
    Views: 524
    Downloads: 2
    This is a blog posted on CFA Institute's website on 26 January 2012.
  • Inflation, the Oldest and Most Powerful Force in the Galaxy

    Source: A. Michael Lipper, CFA
    Date Submitted: 20 Jun 2016
    Views: 544
    Downloads: 4
    This is a blog posted on CFA Institute's website on 10 April 2014.
  • 迈伦·斯科尔斯的全球经济展望

    Source: 迈伦·斯科尔斯
    Date Submitted: 16 Jun 2016
    Views: 292
    Downloads: 2
    This article appears on CFA Institute hedge fund journal 2015 issue, season 1.
  • 我们面对的是一场货币战争

    Source: 梁慧芝, CFA
    Date Submitted: 15 Jun 2016
    Views: 585
    Downloads: 5
    This article appears on CFA Institute hedge fund journal 2013 issue, season 2. The original article appears on Investment Risk and Performance Feature Articles.
  • KYLE BASS: 各中央银行建造波特金村庄 欺骗大众

    Source: Ron Rimkus, CFA
    Date Submitted: 15 Jun 2016
    Views: 266
    Downloads: 3
    This article appears on CFA Institute hedge fund journal 2013 issue, season 2. The original article appears on CFA Institute's official website: http://annual.cfainstitute.org/2013/05/23/kyle-basscentral-bankers-are-building-potemkin-villages-to-deceive-us/
  • 2013年 中国宏观经济市场剖析

    Source: 祝宝良
    Date Submitted: 14 Jun 2016
    Views: 271
    Downloads: 3
    This article appears on CFA Institute hedge fund journal 2013 issue, season 2.
  • 书评: 美联储与金融危机

    Source: Marc L. Ross, CFA
    Date Submitted: 14 Jun 2016
    Views: 510
    Downloads: 1
    This article appears on CFA Institute hedge fund journal 2013 issue, season 1.
  • 金融部门的系统风险 能否预测未来的经济衰退?

    Source: Linda Allen, Turan G.Bali, Yi Tang
    Date Submitted: 14 Jun 2016
    Views: 308
    Downloads: 1
    This article appears on CFA Institute hedge fund journal 2013 issue, season 1.
  • 大格局判断与宏观投资

    Source: 刘海影,CFA
    Date Submitted: 14 Jun 2016
    Views: 297
    Downloads: 2
    This article appears on CFA Institute hedge fund journal 2013 issue, season 1.
  • Creating Value through Governance - Towards a New Accountability - A consultation

    Source: Moxey, P., Berendt, A.
    Date Submitted: 10 Jun 2016
    Views: 664
    Downloads: 6
    This consultation paper forms part of ACCA’s investigation to examine whether existing governance and risk management frameworks are ‘fit for purpose’. It asks whether corporate governance in practice, is helping business to create value or whether something has gone wrong. This paper argues that corporate governance is about creating value and that governance codes should be evaluated on how well they facilitate the creation of value. It sets out how a framework of ‘performing, informing and holding to account’ can work.
  • Culture and Channeling Corporate Behaviour: Summary of findings

    Source: Moxey, P., Schu, P.
    Date Submitted: 10 Jun 2016
    Views: 657
    Downloads: 9
    Part of a series of four reports that aims to assist boards in preparing to assess their corporate culture and in understanding how it can influence either functional or dysfunctional behaviour.
  • SoMoClo Technologies: Transforming how and where business takes place

    Source: ACCA, IMA
    Date Submitted: 10 Jun 2016
    Views: 655
    Downloads: 6
    While social, mobile and cloud technologies (‘SoMoClo’) offer great opportunities to continue the automation of processes, SoMoClo should not be seen simply as more automation. Nor is it merely about ‘mobilising’ or ‘socialising’ existing processes and putting them in the cloud. Instead, SoMoClo provokes a revisiting and questioning of all processes, which may have evolved in response to constraints that no longer exist. SoMoClo will be a crucial driver to evolving the role of the finance professional.
  • Ending Late Payment: Part 3 - Reflection on the evidence

    Source: Schizas, M.
    Date Submitted: 10 Jun 2016
    Views: 616
    Downloads: 3
    This is the third of a series of three reports on the problem of late payment and how businesses and governments can work together to alleviate it. It summarises the ACCA’s findings on this important issue and is a call to action for governments, financial services firms, large corporates and small businesses.
  • Ending Late Payment: Part 2 - What works?

    Source: Schizas, M.
    Date Submitted: 10 Jun 2016
    Views: 645
    Downloads: 5
    This is the second of a series of three reports on the problem of late payment and how businesses and governments can work together to alleviate it. It brings together evidence from a wealth of ACCA-commissioned publications and other research as well as 36 case studies involving ACCA members around the world to help define good practice in both business and policy.
  • Ending Late Payment: Part 1 - Taking stock

    Source: Schizas, M.
    Date Submitted: 10 Jun 2016
    Views: 667
    Downloads: 3
    This is the first of a series of three reports on the problem of late payment and how businesses and governments can work together to alleviate it. It combines an extensive literature review with quantitative data from ACCA’s member surveys to correctly define late payment, trace its precise origins and document its impact on the global economy.
  • Tomorrow’s finance enterprise

    Source: ACCA, IMA
    Date Submitted: 10 Jun 2016
    Views: 488
    Downloads: 4
    In this report we ask a simple question: what are the key influences shaping the future role of the CFO and tomorrow’s finance enterprise? The report draws on all of our ongoing CFO-focused research and includes highlights of a 2014 survey of 1631 ACCA and IMA members around the world
  • China's Next 100 Global Giants

    Source: Hunag Q.H., Atherton, A., Zhan, G.
    Date Submitted: 09 Jun 2016
    Views: 730
    Downloads: 7
    A growing number of Chinese businesses are moving from dominance of domestic markets to global growth. This report identifies 100 emerging businesses that are not yet well known outside China but will be competing globally over the next three to five years.
  • Low Prices, High Expectations: Oil and Gas CFOs in Demand

    Source: ACCA
    Date Submitted: 09 Jun 2016
    Views: 1968
    Downloads: 18
    This report takes a closer look at how CFOs are tackling the big investment decisions: how they are adapting their funding strategies, how they balance short- and long-term priorities, and how they factor into their planning a range of shifting regulatory and market demands.
  • Innovation, Intangibles and Integrated Reporting: A pilot study of Malaysian SMEs

    Source: Brassell, M, Reid, B.
    Date Submitted: 09 Jun 2016
    Views: 752
    Downloads: 5
    This report presents the results of a pilot project, which tests the relevance of the Malaysian National Corporate Innovation Index to small and medium-sized enterprises.
  • Harnessing Potential: The Asia-Pacific alternative finance bench-marking report

    Source: Zhang, B., Deer, L., Wardrop, R., Grant, A., Garvey, K., Thorp, S., Ziegler, T., Kong, Y., Zheng, X.W., Huang, E., Burton, J., Chen, H.Y., Lui, A., Gray, Y.
    Date Submitted: 09 Jun 2016
    Views: 726
    Downloads: 12
    Online alternative finance is developing rapidly in the Asia-Pacific region. It is characterised by innovative financial instruments and channels that fall outside the traditional avenues of capital raising and financial intermediation. From reward-based crowdfunding to peer-to-peer consumer and business lending (i.e. marketplace lending), to invoice trading and equity-based crowdfunding, these online alternative finance activities are directly connecting lenders to consumer and small business borrowers, raising venture capital for start-ups, funding the creative industries and creating new ways for individuals and institutions to choose how and to whom money is distributed, lent and invested and invested.
  • Global Economic Conditions Survey Report: Q1, 2016

    Source: ACCA, IMA
    Date Submitted: 09 Jun 2016
    Views: 482
    Downloads: 8
    The Global Economic Conditions Survey (GECS) is one of the largest regular economic survey in the world in respect to respondents and the range of economic variables monitored. Its main indices are good predictors of such factors as GDP growth and daily trend deviations correlating with VIX (or ‘fear’ index), which measures expected stock price volatility. Fieldwork for the Q1 2016 GECS took place between 26 February and 15 March 2015, and attracted over 1,200 responses.
  • Global Economic Conditions Survey Report: Q4, 2015

    Source: ACCA, IMA
    Date Submitted: 09 Jun 2016
    Views: 391
    Downloads: 5
    The Global Economic Conditions Survey (GECS) is one of the largest regular economic survey in the world in respect to respondents and the range of economic variables monitored. Its main indices are good predictors of such factors as GDP growth and daily trend deviations correlating with VIX (or ‘fear’ index), which measures expected stock price volatility. Fieldwork for the Q1 2015 GECS took place between 27 November and 25 December 2015, and attracted over 2,500 responses.
  • Global Economic Conditions Survey Report: Q3, 2015

    Source: ACCA, IMA
    Date Submitted: 09 Jun 2016
    Views: 484
    Downloads: 4
    The Global Economic Conditions Survey (GECS) is one of the largest regular economic survey in the world in respect to respondents and the range of economic variables monitored. Its main indices are good predictors of such factors as GDP growth and daily trend deviations correlating with VIX (or ‘fear’ index), which measures expected stock price volatility. Fieldwork for the Q1 2015 GECS took place between 11 September and 22 September 2015, and attracted over 950 responses.
  • Global Economic Conditions Survey Report: Q2, 2015

    Source: ACCA, IMA
    Date Submitted: 09 Jun 2016
    Views: 283
    Downloads: 3
    The Global Economic Conditions Survey (GECS) is one of the largest regular economic survey in the world in respect to respondents and the range of economic variables monitored. Its main indices are good predictors of such factors as GDP growth and daily trend deviations correlating with VIX (or ‘fear’ index), which measures expected stock price volatility. Fieldwork for the Q2 2015 GECS took place between 29 May and 16 June 2015, and attracted over 950 responses.
  • Global Economic Conditions Survey Report: Q1, 2015

    Source: ACCA, IMA
    Date Submitted: 09 Jun 2016
    Views: 281
    Downloads: 3
    The Global Economic Conditions Survey (GECS) is one of the largest regular economic survey in the world in respect to respondents and the range of economic variables monitored. Its main indices are good predictors of such factors as GDP growth and daily trend deviations correlating with VIX (or ‘fear’ index), which measures expected stock price volatility. Fieldwork for the Q1 2015 GECS took place between 27 February and 17 March 2015, and attracted over 900 responses.
  • 2014年中国经济希望与阵痛

    Source: 徐彪
    Date Submitted: 06 Jun 2016
    Views: 292
    Downloads: 1
    This article appears on CFA Institute hedge fund journal 2014 issue, season 1.
  • The Impact of Population Dynamics on the Chinese Capital Markets

    Source: Alan Lok
    Date Submitted: 05 Jun 2016
    Views: 666
    Downloads: 3
    This is a blog posted on CFA Institute's website on 11 January 2015.