Chinas Financial Markets:

An Insiders Guide to How the Markets Work

Salih N. Neftci and Michelle Yuan Menager-Xu

'This timely and comprehensive book is certain to become an essential reference tool for anyone interested in the development of financial markets in China. Its broad and up to date coverage makes it particularly valuable for understanding the rapidly evolving nature of the financial system on the Mainland.'

--Hans Genberg, Director, Hong Kong Institute for Monetary Research

"This book is destined to be a standard reference for anyone interested in China's financial markets."

--Herbie Skeete, Managing Director, Mondo Visione Ltd, Publishers of the Handbook of World Stock, DerivativeandCommodity Exchanges

Among the hundreds of books about doing business in China, this book stands out. It is a comprehensive and careful description of each sector of China's financial markets, written by insiders--Chinese executives and officials in these sectors. Translated into English and carefully edited by finance professionals Salih Neftci and Michelle Yuan Menager-Xu, this book provides a look into the details of China's financial markets that outsiders could never access on their own.

Salih Neftci, an expert in finance whose teaching and research span North America, Europe and Asia, and Michelle Yuan Menager-Xu, a Chinese finance professional currently working in Geneva, bring together an unprecedented collection of Chinese insiders to provide a detailed description of the banking system, the money, equity, futures, FX, and bond markets, the insurance sector, the mortgage market and mortgage instruments, and the regulators. Readers will learn how each of these financial sectors operates, how the government, regulators, and the central bank are involved, each sectors history, size and projected growth, an analysis of its current situation and discussion of future trends, the major players, and how the game is played. The book includes a CDROM that contains English translations of key regulations in the financial markets not available elsewhere. This is a must-read book for serious finance professionals seeking financial success in this emerging market.

Salih N. Neftci teaches at the Graduate School, City University of New York, ICMA Centre, University of Reading, UK, and at the Hong Kong University of Science and Technology, Hong Kong.

Michelle Yuan Menager-Xu teaches at IFM, Geneva, and is a Senior Financial Consultant at Ruiji-Regis, a major consulting firm based in Shanghai, China (www.ruiji-regis.com).

[Inside front jacket flap]

Chinas Financial Markets:

An Insiders Guide to How the Markets Work

Salih N. Neftci and Michelle Yuan Menager-Xu

Table of Contents

Ch 1 An Overview of Chinas Financial Markets

--Lisheng Liu, Renmin University and Wuhan University, and Officer of the International Cooperative Department in the China Securities Regulatory Commission

Ch 2 Chinas Money Markets

--Xu Zheng, Fund Manager for Yin Hua Fund Management Company

Ch 3 Chinas Money Markets: Policies and the Banks

--Thom Thurston, CUNY

Ch 4 Chinas Foreign Exchange Markets

--Yan Le, Deputy General Manager, Bank of China Trading Centre

Ch 5 Chinas Bond Markets

--Jiachun Le, Senior Editor and Reporter, Shanghai Securities News

Ch 6 Chinas Convertible Bond Market

--Qiang Liu, University of Electronic Science and Technology of China

Ch 7 Chinas Equity Markets

--Wentao Tan, Treasury Dealer, Malayan Banking Berhad, Shanghai Branch

Ch 8 A History of Chinas Stock Markets

--Wentao Tan, Treasury Dealer, Malayan Banking Berhad, Shanghai Branch

Ch 9 Chinas Futures Market

--Wentao Tan, Treasury Dealer, Malayan Banking Berhad, Shanghai Branch

Ch 10 Chinas Derivatives Markets

--Michelle Yuan Menager-Xu, IFM, Geneva, and Senior Financial Consultant, Ruiji-Regis, Shanghai

Ch 11 Chinas Mortgage and Housing Market

--Wu Xu Chuan, Peoples Bank of China Research Center

Ch 12 Chinas Insurance Market

--Lin Guan, China Insurance Regulation Commission

Ch 13 Investment Funds in China

--Xianjie Mu, Director, Golden Asset Management Co. Ltd, Shanghai

CDROM containing English translations of Key Chinese Financial Regulations:

1. Regulation 1 - Access of Banking Institutions to National Inter-bank Lending Market

2. Regulation 2- Bond Forward Trading on the National Inter-bank Bond Market

3. Regulation 3 - Financial Bonds on the National Inter-bank Bond Market

4. Regulation 4 - The bankcard industry

5. Regulation 5 - Short-term Financing Bills

6. Regulation 6 - Administration of the Issuance of RMB Bonds

7. Regulation 7 - Administrative rules for pilot securitization of credit assets

8. Regulation 8 '" lending interests rate of financial institutions

9. Regulation 9 '" guidance of management of mortgages of commercial banks

'This timely and comprehensive book is certain to become an essential reference tool for anyone interested in the development of financial markets in China. Its broad and up to date coverage makes it particularly valuable for understanding the rapidly evolving nature of the financial system on the Mainland.'

--Hans Genberg, Director, Hong Kong Institute for Monetary Research

"This book is destined to be a standard reference for anyone interested in China's financial markets."

--Herbie Skeete, Managing Director, Mondo Visione Ltd, Publishers of the Handbook of World Stock, DerivativeandCommodity Exchanges

ty Exchanges

This book brings together an unprecedented collection of Chinese insiders who are experts in their respective industries who provide a detailed description of China's banking system, the money, equity, futures, FX, and bond markets, the insurance sector, the mortgage market and mortgage instruments, and the regulators. The CD-ROM contains English translations of relevant Chinese regulations not available elsewhere.

There are hundreds of books about doing business in China. But this book really is different. It is a comprehensive and careful description of each sector of China's financial markets, written by insiders--Chinese executives and officials in these sectors. Translated into English and carefully edited by Neftci and Xu, this book provides a look into the details of China's financial markets that outsiders could never access on their own.

ancing Bills

6. Regulation 6 - Administration of the Issuance of RMB Bonds

7. Regulation 7 - Administrative rules for pilot securitization of credit assets

8. Regulation 8 — lending interests rate of financial institutions

9. Regulation 9 — guidance of management of mortgages of commercial banks

Salih Neftci is currently teaching at Hong Kong University of Technology, ICMA Centre, University of Reading, UK, and in the graduate schools at City University of New York and New School University, New York, NY. He writes regular financial columns for the Chinese Press. Dr. Neftci is also Risk Management Advisor to the IMF. He has been a consultant to the World Bank, the US Department of State and the Agency for International Development. His teaching is in the areas of numerical methods in asset pricing, the mathematics of financial derivatives, emerging market asset trading strategies, and advanced risk management. Salih Neftci completed his Ph.D. at the University of Minnesota and subsequently taught at George Washington University, Columbia University, and the Graduate Institute for International Economics, Geneva.Michelle Yuan Menager-Xu is an associate of the Swiss Actuarial Society. She graduated from the School of Business, University of Lausanne, Switzerland. She holds Master’s degrees in both Actuarial Science and Finance. She is writing her Doctoral Thesis at the Institute of Actuarial Science, Lausanne University. Her research focuses on applications of swaption pricing theory to surrender options found in insurance contracts. She has worked at Swiss Reinsurance Company in Zurich, Switzerland, and was in charge of business in the China Region (Mainland, Hong Kong, Taiwan and Macao), including risk management, reserve issues, and various insurance and bank-insurance product pricing.

Ch 1: Introduction and Overview; Ch 2: The structure of the Chinese banking system; Ch 3: Chinese money markets; Ch 4: Chinese equity markets; Ch 5: Chinese futures markets; Ch 6: The FX market; Ch 7: The bond market; Ch 8: The insurance sector; Ch 9: The mortgage market and mortgage instruments; Ch 10: Chinese regulators; Ch 11: Conclusion