Asia-Pacific Policy Measures to Curb Inflows: TimelineMichael J. Munoz
The following is a timeline showing measures taken by Asia-Pacific policy makers from March 2012 to cool property prices, curb capital inflows, and adjust foreign-exchange rules, as compiled by Bloomberg News.
=============================================================================== Date Measures =============================================================================== ------------------------------------ 2013 ------------------------------------- PH March 5 Bangko Sentral ng Pilipinas Governor Amando Tetangco says encouraging outflows is a way to help manage capital flows. Philippines to Further Loosen FX Rules to Manage Flows NZ March 4 New Zealand central bank releases consultation paper with suggested policy tools to cool property prices, seeking feedback from the banking industry. Measures include countercyclical capital buffer, core funding ratio, sectoral capital requirements, and restrictions on high loan-to-value residential mortgage lending. RBNZ Review Includes Capital Buffer, Core Funding Ratio, LVR CH March 1 China told its central bank to raise down-payment requirements and interest rates for second-home mortgages in cities with “excessively fast” price gains as authorities step up efforts to cool the property market. China Tightens Mortgage Rules as Property Prices Increase IN March 1 Reserve Bank of India removes the restrictions on overnight and intra-day open positions on forex contracts involving rupee. India RBI Removes Restrictions on Open Rupee Positions MY Feb. 28 Malaysia plans to tighten rules on the daily setting of key dollar-ringgit reference rate from in an effort to boost transparency and shield the domestic market against manipulation. Malaysia Said to Plan Tighter Dollar-Ringgit Fixing Rules SP Feb. 25 Singapore announces plans to raise property levies for luxury homeowners and increase duties on investment properties that are vacant or being rented out. Singapore to Raise Property Tax Rates for Luxury Homeowners HK Feb. 22 Hong Kong doubles the stamp duty on all property deals over HK$2 million, including residential, commercial, industrial properties and car parks, to as much as 8.5%. The Hong Kong Monetary Authority also requires banks to lower the maximum mortgage loan-to-value ratio on commercial properties by 10 percentage points. Hong Kong Doubles Stamp Duty on All Properties on Bubble Risks SK Feb. 21 South Korea may adjust currency-forward rules and levy on banks’ debt in foreign currency if needed, president Park Geun Hye’s transition team announced. S. Korea Park’s Govt to Adjust FX Trading Rules If Needed ID Feb. 6 Indonesia’s central bank calls for local lenders to create an onshore reference rate to settle rupiah forward transactions domestically. Bank Indonesia Calls for Onshore Rupiah Fixing Amid Probe TH Jan. 30 Thailand will set up a team of economists, including central bank Governor Prasarn Trairatvorakul, to study how to respond to short-term capital inflows, Finance Minister Kittiratt Na-Ranong says. Thailand Won’t Impose Capital Controls, Finance Minister Says SK Jan. 30 Deputy Finance Minister Choi Jong Ku said South Korea should review imposing taxes on foreign exchange transactions and bonds to curb speculative capital inflows. The government will closely monitor foreign currency transactions at major companies and speculative trading in NDF market, Choi said. S. Korea Should Review Tax on FX Trading, Bonds, Choi Says MY Jan. 29 Malaysia’s central bank calls for local lenders to use an onshore ringgit fixing to settle foreign-exchange contracts. Malaysia Said to Require Local Fixings for Ringgit Contracts PH Jan. 24 Philippines cuts rate on $44 billion of special deposit accounts to 3% to help ensure that liquidity remains adequate to meet the requirements of the economy. Philippines Cuts Special Deposit Account Rate to Curb Inflows HK Jan. 16 Hong Kong will build a land reserve and speed up public-housing construction, Chief Executive Leung Chun-ying said, as the city seeks to tame record high property prices that have led to concerns of a housing bubble. Hong Kong Chief Unveils Plans to Ease City Housing Shortage SP Jan. 11 Singapore introduces more measures to curb speculation on residential and industrial properties after home prices climbed to a record. Singapore Imposes More Measures to Curb Property Speculation ------------------------------------ 2012 ------------------------------------- PH Dec. 26 Philippines’ Tetangco announced caps on NDF transactions of local banks at 20% of capital and at 100% of capital for foreign entities. Note: Circular on the curbs hasn’t yet been issued. Philippines Joins Korea in Restraining Currency Gains SK Nov. 27 South Korea tightened limits on the amount of currency forward positions banks are allowed to hold to curb capital inflows. Transactions at branches of overseas lenders were capped at 150% of equity, compared with 200% previously. The ceiling for domestic banks was cut to 30% from 40%. The changes took effect from Jan. 1, 2013. South Korea Limits Bank Currency Forwards as Won Strengthens TW Nov. 19 Taiwan’s Financial Supervisory Commission revises rules to strengthen oversight and insurers’ internal controls. Taiwan Tightens Rules for Insurers’ Investments in Real Estate HK Oct. 26 Hong Kong announced its first property tax targeted at overseas buyers, stepping up efforts to cool home prices. Non-local and corporate buyers are required to pay a 15% tax upon purchase of residential property. The government also raised a resale tax on property transactions by about 5 percentage points to as much as 20%. Hong Kong Imposes Non-Locals Property Tax on Bubble Risks SP Oct. 5 Singapore to restrict home-loan maturities to curb housing bubble after property prices rose to a record. Singapore Caps Residential Loan Tenures After Prices Hit Record MY Sept. 28 Malaysia proposes to raise real property gains tax to 15% from 10% for properties disposed of less than 2 years after purchase. RPGT for houses sold 2-5 years after purchase would be raised to 10% from 5%. Malaysia to Raise Real Property Gains Tax, Najib Says HK Sept. 14 Hong Kong Monetary Authority said it’ll limit the maximum terms on all new mortgages to 30 years. It also lowered the cap on mortgage payments for investment properties to 40% of buyer’s monthly income, from 50%. Hong Kong Tightens Mortgage Lending Amid QE3 Concerns of Bubble HK Sept. 6 Hong Kong restricts buyers of apartments on two sites it plans to sell to local residents only as the government attempts to cool housing prices. Hong Kong to Give Preference to Local Buyers on 2 Sites in 2013 HK Aug. 30 Hong Kong’s government said it would speed up the approval of permits for private project sales and began selling some public units originally intended for rent. Hong Kong to Boost Home Sales, Favor Locals as Prices Surge PH Aug. 23 Philippines approves new guidelines providing “more comprehensive” measure of a bank’s real estate exposure. Philippines Intensifies Monitoring of Banks’ Property Exposures ID Aug. 10 Indonesia central bank says it will lower current-account deficit via exchange-rate policy, and by narrowing the bottom end of the monetary authority’s deposit facility to 175 basis points below its benchmark interest rate from 200 basis points, or from 3.75% to 4%. Indonesia Taking Steps to Reduce Rising Current-Account Deficit PH July 13 Philippine central bank cuts rates on its special deposit accounts in a “mini-easing” to cool peso gains, affecting 1.64 trillion pesos ($39 billion) worth of placements. Philippines Cuts Rates on Special Deposits to Contain Peso Gains PH July 7 Philippine central bank prohibits foreign funds from investing in its special deposit accounts, or SDAs, after the peso surged to a four-year high. Philippines Tightens Rules to Stem Inflows, Peso Weakens TW June 21 Taiwan central bank imposes selective credit controls on luxury housing, with mortgages capped at 60% of the value of the property in Taipei and New Taipei city for values of over NT$80 million ($2.7 million), and NT$50 million in other parts of Taiwan. Taiwan Holds Rate to Boost Growth While Curbing Home Prices ID June 7 Indonesia’s central bank says it will implement rules requiring down payments for new home and vehicle loans, seeking to avoid a property bubble and minimize credit risks. Bank Indonesia to Push Through Down-Payment Plan: Southeast Asia IN May 21 Reserve Bank of India said outstanding currency futures and options contracts held by a bank shouldn’t exceed $100 million or 15% of the total such agreements, whichever is lower, on local exchanges. Also, lenders can’t offset derivative trades against those in the over-the-counter market. India RBI Cuts Banks’ Forex Futures Net Open Position Limit ===============================================================================
Source: Bloomberg News
(Corrects year of New Zealand bank review.)
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