Ye Tan: ABC break is of great significance

The Agricultural bank, with its shoes on, was finally out of the battle after a hard-fought price battle.　　ABC break has a significant symbolic significance, indicating that financial deleveraging is in full swing, the traditional production model has been unsustainable. ABC's early break, the bank introduced too stringent protection measures, contrary to market rules, is unfair to other investors.　　Some people think that financial stocks are low valuations, but the choice of prices should be given to the market, rather than by the "four King Kong" escort; others think AgBank's price will hit investors ' confidence, but there is no reason to believe that AgBank is more important than other big banks. More seriously, the media disclosed the four main underwriters of CICC, Citic Securities, Guotai, and Galaxy Securities, which are protected by special treatment-free of commission. This is a stark provocation to market rules, which is intolerable when our regulatory authorities crack down on insider trading and restore market order.　　ABC's IPO is to become a good governance structure of the public companies, rather than become China's securities market is not a sign of market, institutions in the ABC's risk-free arbitrage has become a big joke in China's securities market. ABC's break is a product of financial deleveraging. The superficial reason is that the fund of the protection disk is reduced, the cost of protecting disk is increased. As of September 15, AgBank's bill has dropped nearly 50% from the recent period, and the market has reportedly refused to pay for the commission of the rumors, break a short period of 5 minutes, the transaction amount of up to 339 million yuan, it seems that rumors are not groundless.　　By October 15, the bank to the network under the allocation of shares in a total of 5.032 billion shares lifted, accounting for the current actual circulation of a share of about half, AgBank and other unrelated agencies are unwilling to pay for the lifting of the shares. More importantly, global financial deleveraging is in the ascendant.　　Not only AgBank, BOC, CCB, ICBC and other bank shares have set a new low. Look at the global situation.　　The shares of Goldman Sachs and Morgan Stanley, the two banks that survived the financial crisis as a traditional bank, fell, from the time of Lehman's "deathbed", which fell by 10% per cent to the 500 index, while the bank index of the kbw/Philadelphia Stock Exchange covering large commercial banks fell one-third per cent. This is not all, with the new Basel Accord, the banks ' leverage will be severely constrained, and they no longer have the means to use asset-backed securitization to make a profit by trading toxic products without limiting leverage. Banks around the world, especially European banks, must replenish their capital adequacy ratios, which could be at $ hundreds of millions of trillion, a compromise after a dispute.　　Financial experts analyzed the bad debts after the financial crisis that the minimum requirement for the proportion of common equity to risk-weighted assets in normal years should be 12% in order to withstand the financial crisis.　　The process has already taken place in China, where the CBRC may not be more forward-looking than the Basel Committee, but because of last year's massive lending that has made the seemingly prosperous banks perilous. After the bank has implemented large-scale refinancing, the CBRC seems to beFurther。 China's regulators are brewing new banking regulations based on the Basel III framework, according to the daily economic news. The new rules propose to raise the capital adequacy ratio of commercial banks to 15%. According to the Half-year report of the first half of 2010, 15% capital adequacy ratio and 13% core capital adequacy ratio, the banks face huge capital shortfall. AgBank needs to replenish its capital and core capital at a maximum of 362.682 billion and 331.049 billion, with at least 62.155 billion and 89.169 billion per cent. At the same time, the total capital shortfall of five major lines reached 1,094,620,000,000, averaging 218.924 billion;　　In other words, the bank's deleveraging, supplementary funding gap is far from over.　　To add insult to the pressure, the appreciation of the renminbi is not reduced, the real estate asset bubble is not to be removed, as the bank's share of high-quality assets fell. The only consolation to the banks is that international investors have shown their confidence in China's financial sector through H-shares, which are far more expensive than a-shares. But with different valuation systems, international investors are looking at the prospect of renminbi appreciation and the future of space in rural markets.　　But domestic investors can not profit from the appreciation of the renminbi, the rural market is more risk than "money scene." For domestic investors, only to the end of the deleveraging, the successful transformation of China's banking sector to find the future profit growth, corporate governance structure to improve the return of investors a substantial increase in returns, it is possible to revalue the bank stocks. These two years, is the painful period of bank shares, but also the opportunity of bank transformation.