Dim Sum Express

A-Share Market

    Banking: PBoC to increase net injections to meet pre-CNY liquidity demand

    The PBoC will include off-balance-sheet bank WMPs in the MPA check for 1Q17, which should have a limited impact on large state-owned banks, but will affect joint-stock banks, urban and rural commercial banks more. We expect interbank market interest rates to remain stable between now and the CNY. Most banks started to accumulate a lending project pipeline towards end-2016, and we expect the new bank loan figure to come in quite strong in 1Q17. With the NIM declining at a slower pace, we believe an upward turning point might be seen in 1Q17 earnings growth.

    Environmental: Extended producer responsibility a key policy catalyst for resource recycling industry

    Based on the notion of extended producer responsibility, the electronic scrap processing fund was launched in July 2012 to subsidize the recycling of electronic scrap, the cost of which cannot be fully covered by the sales price of the disassembled parts. The fund has achieved great success in increasing the proportion of retired goods that go through the official scrapping channels. An extended producer responsibility system can also be applicable to the auto, lead-acid battery and packaging materials industries. The establishment of such a system should significantly boost the earnings of legitimate scrapping companies.