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Chinese Banks trading like US banks

Chinese Banks trading like US banks

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LLI Offline
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#1
02-05-2013, 03:19 PM
What is the story with Chinese Banks? Why are all of them trading at such low valuation?

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yaosheng Offline
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#2
02-05-2013, 04:20 PM
concerns abt asset quality
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soros Offline
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#3
23-05-2013, 12:28 AM
Actually the US banks are selling off their shares in China Banks and Tamasek are moving in to buy .
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felixleong Offline
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#4
23-05-2013, 07:43 AM
just like the pre crisis, garmen keep buying stakes in US banks before the crash lol
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byfaith Offline
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#5
23-05-2013, 11:36 AM
felix
what does temasek sees that GS does not see in ICBC ?
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freedom Offline
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#6
23-05-2013, 11:44 AM
There could be many reasons why GS sold.

It could be because of Basel III.

It could be due to deteriorating asset quality in China.

Pick up one you believe the most. Anyway, Temasek chose its already, but it won't tell you.
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safetyfirst Offline
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#7
23-05-2013, 12:11 PM
Never use temasek as a guide for your investment decisions. From time to time, they would also do silly things. Even if they disclose why they bought Icbc, their reasons may still be wrong (although it always sounds sensible). When buying a stake in a financial company, asset quality is damn important, if you have no idea about the quality of these assets carried on the balance sheet, it is best to avoid such companies.
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LLI Offline
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#8
25-05-2013, 03:41 PM
(23-05-2013, 12:11 PM)safetyfirst Wrote: Never use temasek as a guide for your investment decisions. From time to time, they would also do silly things. Even if they disclose why they bought Icbc, their reasons may still be wrong (although it always sounds sensible). When buying a stake in a financial company, asset quality is damn important, if you have no idea about the quality of these assets carried on the balance sheet, it is best to avoid such companies.

There is always the question.... "how low is too low...."

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ikur1 Offline
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#9
26-05-2013, 11:58 AM
be careful of the shadow banking in china tho, i'f i'm not mistaken they have off balance sheet lending worth up to 37% of their assets now, low quality lendings

high yielding products marketed as "wealth management products" used to be channelled through trust companies now the news is they use brokerage houses.
where the money is lent to high risk businesses.

there was a case of a defaulting probly 1 year ago, when it was traced they figured that the money was lent to a small pawnshop in a 3rd tier city
good luck!
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