China stocks up on lending rule change; Hong Kong down as Greek talks disappoint

jueves 25 de junio de 2015 00:44 GYT

* CSI300 +0.6 pct; SSE +0.4 pct; HSI -0.3 pct

* Bank up on China's decision to scrap debt-to-loan ratio

* China to "moderately" increase short-term liquidity

SHANGHAI, June 25 (Reuters) - China stocks rose for the third straight day on Thursday as banking heavyweights gained on Beijing's decision to abolish lenders' debt-to-loan ratio, and as the central bank moved to increase short-term liquidity.

But Hong Kong shares lost ground, dragged down by gloomy global markets as negotiations between Greece and its creditors stumbled, dashing hopes for a last-minute bailout deal.

By midday, the CSI300 index rose 0.6 percent to 4,907.1 points, while the Shanghai Composite Index gained 0.4 percent to 4,710.5.

The CSI300 Bank Index climbed 1.4 percent after China said late on Wednesday that it was scrapping rules which currently prohibit commercial lenders from lending more than 75 percent of their deposits.

Removal of the debt-to-loan ratios (LDRs) would potentially allow 16 listed banks to release up to 6.6 trillion yuan ($1.1 trillion) in extra lending, some analysts estimate. That should in theory give an extra fillip to the slowing economy, though banking sources have told Reuters that loan demand is weak as companies struggle with sluggish sales and are in no mood to make fresh investments.

"In the long term, we believe this relaxation will reduce banks' needs to compete fiercely for deposits as they did before, so banks could have better control over their funding costs," Barclays said in a research note, adding that banks with higher LDRs could benefit more.   Continuación...