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2009-1-14 10:22:00 a.m. HKT, XFNA
DJ MARKET TALK: Too Early To Get Excited About China Banks -Macq
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| 1011 [Dow Jones] It's too early to get excited about China banks despite December monetary data from PBOC showing pickup in lending volume, Macquarie says. Notes December lending volumes very strong at CNY771 billion, bringing 2008 total new lending, net of write-offs, to CNY4.177 trillion, implying 16% on-year loan growth. Adds however, lending spreads may not be as attractive as may be largely related to lending to government earmarked projects, rebound in mortgages on falling rates as suggest loan-yield compression may appear more quickly than reduction in deposit yields. "If growth is driven by government earmarked projects rather than a broad-based recovery in demand, we believe the quality of this growth and its implications from allocation of capital perspective remain questionable." Tips preferred sector picks as China Construction Bank (0939.HK), Bank of China (3988.HK), China Citic Bank (0998.HK). (LES) Contact us in Singapore. 65 64154 140; MarketTalk@dowjones.com
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(Delayed by 1 hour)
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