China’s financial markets represent about $2 trillion and are expected to grow to about $10 trillion by 2008. As these markets continue to open to outside investment, a thorough understanding of how they operate will be essential for success. In this book, Salih Neftci, an expert in finance whose teaching and research span North America, Europe and Asia, and Michelle Menager-Xu, a Chinese finance professional currently working in Geneva, bring together an unprecedented collection of Chinese insiders who are experts in their respective industries. These experts provide a detailed description of the banking system, the money, equity, futures, FX, and bond markets, the insurance sector, the mortgage market and mortgage instruments, and the regulators. Readers will learn how each of these financial sectors operates, how the government, regulators, and the central bank are involved, each sector’s history, size and projected growth, an analysis of its current situation and discussion of future trends, the major players, and how the game is played. This is a must-read book for financial success in this emerging market.
- Experts within China working in each sector provide detailed, completely up-to-date descriptions and analysis
- Describes how the major regulators work and the key influence factors in each industry
Finance professionals worldwide in: equities, bonds, insurance, currency exchanges, and the futures markets. Business development heads in corporations looking to expand into Chinese markets; portfolio managers and other investment professionals managing or creating funds invested in Chinese instruments; MBA students in finance and international business programs.
- Chapter I: Introduction. This chapter will summarize the book and put it in a context. . Chapter 2: The structure of the Chinese banking system.
- Chapter 3: Chinese money markets. ¡ Deposits ¡ Loans. ¡ A discussion of special aspects of the practices related to these basic instruments.
¡ A brief summary of various types of deposits and loans. ¡ Inter-bank market in China. ¡ The role of the foreign banks and the future prospects. ¡ The coming reforms and opportunities.
- Chapter 4: Chinese equity markets
- Historical review
- current situation, progress made since 1.1 Funds, types of funds 1.2 Major types of fund in the china market 1.3 Describe each
- Who are the main market makers? 2.1. Big players and financial institutions 2.2 One specialty in China- ¡°illegal¡± fund raiser- similar to market marker
Who are the main clients? 3.1 Market makers 3.2 Small individuals5. Chapter 5 Futures markets.
- Existing futures markets review 1.1Products existing 1.2 Repo (very recently approved) 1.3 Other derivatives ( in short term will be approved by states)
- Their size and liquidity. 2.1 First glance, look at market size and its liquidity 2.2 One market¡¯s special phenomena: traders trade themselves to make the market look more liquid
- The main players. 3.1 Market makers (mentioned in 2.2) 3.2 Private investors 3.2 Funds and state owned enterprises are not allowed (to participate in the futures)
What are the future prospects? 4.1 An example: Shanghai 4.2 Regulations aspects
Chapter 6 The FX market. Present and the Future.
Chapter 7 The bond market. Tbills, Treasury bonds. CITIC bonds, Callable bonds. The market and the players
- A brief review of Chinese bond market development
- The basic structure of Chinese bond market 2.1 Trading markets 2.2 Inter-bank market(including OTC)
- Main bond instruments available in Chinese market (Tbills, Tbonds, CITIC bonds, Callable bonds) 3.1 Government bond, T-bill and T-notes 3.2 Corporate bond 3.3 Convertible corporate bonds
- Trading in the Chinese bond market, the market an players 4.1 Primary market, bond issuing 4.2 Secondary market, bond trading 4.3 Investors in the bond market 4.4 Transactions method ( trading methods) 4.4.1 Cash deal( deliverable deal)?? 4.4.2 Repo deal
Bond market¡¯s future
Chapter 8: Insurance sector.
- Chinese insurance market background 1.1 AIG first entered china , in 1992 1.2 Current situation ( number of companies in total, Chinese owned, foreign owned, competition, premium received in total) 1.3 Products available in China ( Life, P&C)
- Insurance¡¯s capital management 2.1 New rule: allow insurance capital direct access to the capital market 2.2 Advantages comparing to banks ( in china, banks suffered a lot with bad loan)
Challenges and future 3.1 Credit system need to be improved 3.2 Insurance agencies , insurance professionals
Chapter 9:The mortgage market and mortgage instrumentsSize of the mortgage market. Who are the main players? Where is the main market? Mortgage backed securities and the future of the sector.
- Current size of the mortgage market ( give different measurement for the size) 1.1 investment capital in the real estate 1.2 sales volume 1.3 surfaces under construction 1.4 prices and prices index
- Who are the main players? 2.1 Four state owned commercial banks 2.2 Other major corporate banks (11 in Shanghai) 2.3 The others (small players, rating agencies, guarantee services providers¡)
- Where is the main market? 3.1 Three major cities (Shanghai, Beijing, ShengZheng) and give a comparison of these cities 3.2 The new comers, cities has good economic potential, good tourist resources (Wen Zhou, Huang Zhou and Qin Dao)
Mortgage backed securities and the future of the sector 4.1 Current situations 4.2 How the future will be 4.3 What Chinese is doing/ should do to be ready for the future?
- Chapter 10: Chinese regulators a. Stock market and Funds regulator. b. Money market regulator c. Insurance regulator Where they are, what they do, and what are their powers? What the authorities are planning for the future? 1 The main character of Chinese financial regulators ¨C monitoring the market on different sector basis 2 How does Stock market is regulated 3 How does Money market is regulated 4 Insurances sectors regulation 5 The plans of Chinese financial regulator in the future
Chapter 11: Conclusion
- No. of pages:
- © Academic Press 2007
- 21st November 2006
- Academic Press
- eBook ISBN:
Professor Neftci completed his Ph.D. at the University of Minnesota and was head of the FAME Certificate program in Switzerland. He taught at the Graduate School, City University of New York; ICMA Centre, University of Reading; and at the University of Lausanne. He was also a Visiting Professor in the Finance Department at Hong Kong University of Science and Technology. Known his books and articles, he was a regular columnist for CBN daily, the most influential financial newspaper in China. Salih Neftci was already suffering from gliosarcoma, a malignant brain cancer, while writing the second edition. It published just 5 months before his death on April 15, 2009.
Late of the Global Finance Master’s Program, New School for Social Research, New York, NY, USA
Michelle Yuan Menager-Xu graduated from the School of Business, University of Lausanne, Switzerland. She holds Master’s degrees in both Actuarial Science and in Banking & Finance. Michelle is an associate of the Swiss Actuarial Society, and has worked at various consulting firms and in insurance and reinsurance companies in both Switzerland and China. Previously she worked at Swiss Reinsurance Company in Zurich, Switzerland, and was in charge of business in the China Region (Mainland, Hong Kong, Taiwan and Macao), including risk management, reserve issues, and various insurance and bank-insurance product pricing. Currently she is writing her Doctoral Thesis at the Institute of Actuarial Science, Lausanne University. Her research focuses on applications of swaption pricing theory to surrender options found in insurance contracts. Her research areas are: risk management, FX market, Fixed income, financial engineering and tourism economics.
IFM, Geneva, Senior Financial Consultant, Ruiji-Regis, Shanghai, China
“This timely and comprehensive book is certain to become an essential reference tool for anyone interested in the development of financial markets in China. Its broad and up to date coverage makes it particularly valuable for understanding the rapidly evolving nature of the financial system on the Mainland.” --Hans Genberg, Director, Hong Kong Institute for Monetary Research "This book is destined to be a standard reference for anyone interested in China's financial markets." --Herbie Skeete, Managing Director, Mondo Visione Ltd, Publishers of the Handbook of World Stock, Derivative & Commodity Exchanges