ICBC applies for offshore licenses
Industrial & Commercial Bank of China, the country’s largest commercial bank, has applied for US and Russian banking licenses as it seeks to expand internationally, the 21st Century Business Herald reported. It hopes to begin conducting investment banking business offshore over the next two to three years. The bank also wants to diversify its financial product offerings, targeting insurance, trusts and leasing businesses. ICBC raised almost US$22 billion through its IPO in Shanghai and Hong Kong on 27 October 2007.

Inflation slows in May
Inflation slowed from April to May as raw materials like oil and metals became cheaper, China Economy reported. Producer prices climbed 2.8% year-on-year compared to 2.9% in April, and grew 2.8% for the first five months combined, according to National Bureau of Statistics. However, producer prices for food – which constitutes one-third of the CPI – went up 6.3% due to the surging price of pork and other staples. “The minor slowdown was due to small fluctuations in petrol and non-ferrous metals," said an analyst with Haitong Securities. However, analysts said inflationary pressure still existed, which could encourage the central bank to further tighten the money supply

Xiamen bank plans IPO
Xiamen International Bank is considering going public to raise expansion capital, the China Times reported. The bank is in contact with Haitong Securities to endorse a RMB-denominated A-share IPO, but it must first slash its foreign ownership to less than 25% to be qualified for a mainland listing. Among its overseas shareholders are Japan’s Shinsei Bank (10%), Asian Development Bank (10%) and US-based Sino Finance (5%). China’s largest commercial Bank – the Industrial and Commercial Bank of China – owns an 18.75% stake. It is estimated Xiamen International bank could raise up to US$649 million through an IPO.

Danone eyes non-hostile resolution with Wahaha
French Danone said the lawsuit against its joint venture partner Hangzhou Wahaha could end with a non-hostile settlement, China Business News reported. Danone has accused Wahaha of selling products that looked the same as those sold by its joint ventures with Danone. Emmanuel Faber, regional president of Danone in Asia-Pacific, is expected to attend a press conference at the company’s Shanghai office later this week. Danone and Wahaha set up their first joint venture in 1996, which become one of China’s largest beverage makers. Relations went stale a couple of months ago after Wahaha’s chairman publicly turned down an offer by Danone to purchase some of Wahaha's assets, calling the offer the first step of an ultimate acquisition.

Saudi firm invests in Sinopec ethylene base
Saudi Arabia-based Sabic said it will invest US$1 billion in an ethylene production base in Tianjin run by Sinopec, the Economic Daily reported. The Saudi firm said the deal was still waiting for final approval from the Chinese government. The project is expected to produce one million tons of ethylene every year. Sinopec, Asia’s largest oil producer, has already kicked off construction.

Hong Kong textile firm to issue shares in S Korea
Huafeng Textile International Group, a Hong Kong-based fabrics company with factories in China, has prepared to sell US$39 million (HK$300 million) worth of stocks on the Seoul Stock Exchange next month, the Hong Kong-based Taokungpao reported. The textile company plans to use the money for mergers and acquisitions to expand factory facilities.

Mercedes-Benz sales up 23%
Mercedes-Benz sales in China climbed 23% to 11,200 vehicles in the first five months of 2007 thanks to its S-class models, China Business reported. China sales made up 72% of the German luxury automaker’s Far East sales in the period. “By offering more innovative technologies through our flagship S-Class models, we have solidified our status as leader of the luxury auto market,” said Klaus Maier, president and CEO of Mercedes-Benz China. Mercedes-Benz is also cooperating with Beijing Automotive Works to produce E-class sedans, with 25,000 units expected to be made each year. China’s luxury auto market, which is dominated by Audi and BMW models, grew 30% in 2006.

Shanghai’s second-hand property sales up
Shanghai’s booming property market boosted second-hand deals in May with the average unit price rising more than one percent, the Wenhui Daily reported. Homebuyers showed a preference for properties close to metro and bus stations. Second-hand property prices in Jing'an district grew 2.35%, West Nanjing Road reported a 4.42% increase, Luwan district 2.02%, and Central Huaihai Road 3.86%. The newspaper said the revitalized real estate market has sucked money out of the stock market.