Third Annual Conference
Conference Report
(By Changneng XUAN)
The Chinese Finance Association (TCFA) held its Third Annual Meeting
at the Business School (Uris Hall) of Columbia University in New York city
from September 20-21, 1996. About 60 TCFA members and guests attended this
event.
The meeting commenced with an opening speech by the president of
TCFA, Mr. Xiaodi Sun of the University of Chicago. He retrospected the
major activities and achievements of the association during the past year.
His speech was followed by a panel discussion which featured panelists Mr.
Jiashu Luo, the Vice General Manager of the New York Branch of the Bank
of China, Mr. Susumu Awanohara, Advisor to Nikko Securities and Mr.
Richard Farrell, Portfolio Manager of Guinness Flight Asia Blue Chip Fund
and Guinness Flight China and Hong Kong Fund. Mr. Luo talked about the
growing presence of banking (both commercial and investment banking)
operations of the Bank of China in North America and especially in the
United States. Mr. Awanohara's topic was "The republican Congress: Asia's
Gain, or Pain?" He shared with the audience his insight about the mindset
and attitude of the Republican Congress of the U.S. on issues related to
Asia and China in particular. Mr. Farrell's talk was titled "Hong Kong and
Southern China: the Jewel in Asia's Crown." He presented his view and
concerns about the long-term prospect of Hong Kong and South China. He
also discussed the performance and objectives of the portfolios under his
management and the criteria of selecting the stocks.
After the conference lunch, the meeting resumed with Professor Huang,
Da's talk about China's financial reform. Professor Huang is currently
the vice chairman of the Finance and Economics Committee of the National
People's Congress and an advisor to TCFA. He flew from Beijing to New York
specially for the meeting. He presented his retrospect on the progress
China has made on financial reform and the prospect of success. He
answered many questions the audience had about China's financial reform
including specifics on risk management and foreign exchange reserve
utilization. After Prof. Huang, Da's talk, another guest speaker,
Professor Huang Weiping of Remin University presented his view on the
Chinese savings puzzle. He argued that the Chinese high savings rate is a
result of the dynamics of economic uncertainty and political and social
stability. Professor Huang also exchanged ideas with the audience on
different perspectives and explanations on the same issue. The afternoon
session concluded with the third guest speaker, Mr. Kevin Kime from the
Federal Reserve Bank of New York. He presented his study on seigniorage
tax in China and its historical importance in funding the budget deficit
of the Chinese government. He predicted that as China's financial reform
deepens, this hidden tax will be increasingly difficult for the
government to impose and its importance will wane as a result..
The meeting concluded its first day with the conference dinner at the
faculty House of Columbia University. The dinner speech was given by Mr.
Shengman Zhang, Vice President of the World Bank. Mr. Zhang shared with
the audience his experience and insights about the World Bank, its
operations in developing and especially African countries, its
achievements and problems. He also shared with the conference attendants
his views on World Bank's prospect and future reforms.
The second day's agenda included paper presentations, a Recruiting
Session and the annual election of TCFA officers . Four TCFA members
presented their research on various topics. Lin Guo of Boston College
presented her paper entitled "When and Why Are Thrifts Resolved?",
followed by Helen Liu of Columbia University, who presented "Dividend
Policy:New Insights from a Comparative Study of Hong Kong and the United
States", co-authored with Professor Thomas J. Chemmanur. Changneng Xuan of
the University of Texas at Austin presented his paper with Professor Ehud
I. Ronn on "Vega-Hedging: An Antidote for Model Misspecification". The
session concluded with the talk of Tongshu Ma of the University of
Minnesota, who presented his work titled "Bayesian Estimates of Local
Volatility Using High, Low and Close Prices". Each of the paper
presenters answered many questions from the audience.
The Recruiting Session featured Dr, Gang Chu, Assistant Vice
President of Citicorp's Division of Capital Market and Risk Analytics who
discussed the needs of quantitative skills in Citicorp's derivatives
pricing and risk management operations. He also offered some job hunting
tips, which are particularly relevant for people with strong quantitative
skills or background. The recruiting session ended with the presentation
of Jennifer Sun from Wang & Li Asia Resources. Ms. Sun's informative
discussion focused on job markets for finance, consulting and market in
the greater China regions (Mainland, Hong Kong and Taiwan). She also
discussed the qualifications requirements, the procedures, timing and
resources such as head hunters or job agencies related to job hunting in
those regions. Both presenters answered questions from the audience.
The closing remarks of the conference was given by Mr. Guojun Wu,
Chairman of the Board of TCFA. He thanked the annual meeting organization
committee and others for making the meeting a successful one. Board
members were invited to briefly report their respective activities for the
year. Among them, Mr. Xianghai Ma of John Hancock Mutual Life Insurance
Company, the treasurer of TCFA, reported to the conference the major
revenues and expenses during the past year; Mr. Zheng Liu of the
University of Minnesota reported to the meeting the general preparation of
the Beijing Conference in August. Mr. Qianli Wu of Boston University
briefed the meeting about the preparation for the Hong Kong Conference,
scheduled for May 1997. Dr. Hong Yan of UC Berkeley briefed the audience
about the progress and operation of TCFA Update, the weekly newsletter of
TCFA and encouraged members to contribute and serve as editors to the
newsletter.
The annual meeting concluded with the election of TCFA officers for the
1996-97 term. Members present at the meeting elected the following
members as new officers:
President: Li, Bo (Harvard University)
President-elect: Wu, Guojun (Stanford University)
The president and president-elect are automatically board members of
the TCFA, other nine directors of the board elected are:
Chen, Holly Meng (Merrill Lynch)
Qian, Jun (NationsBank)
Su, Dongwei (Ohio State University)
Sun, Xiaodi (University of Chicago)
Wu, Qianli (Boston University)
Xuan, Changneng (University of Texas at Austin)
Yan, Hong (UC Berkeley)
Yan, Yanfang (Boston College)
Zhang, Xin (Columbia University)
The Board of Directors elected Hong Yan as the Chairman of the
Board. The board also pointed Su, Dongwei as treasurer and Yanfang Yan
the Editor-In-Chief of TCFA Update.
Featured Speakers
Mr. Huang Da Vice Chairman, Finance and Economics Committee,
National People's Congress
Mr. Shengman Zhang Vice President, The World Bank
Mr. Jiangshu Ruo Vice General Manager, Bank of China (New York)
Mr. Richard Farrell Manager, Guinness Flight China Fund
Prof. Huang Weiping Director, Asia-Pacific Economic Center, People's
University of China
Dr. Susumu Awanohara Advisor, Nikko Securities and Former Bureau
Chief for Washington, Tokyo, and Singarpore,
Far Eastern Economic Review
Dr. Kevin Kime Senior Economist, Federal Reserve Bank
of New York
Past CFA speakers include:
Prof. Kenneth Arrow Nobel Economics Laureate, Stanford University
Prof. Michael Boskin Former Chairman, Council of Economic Advisors to
the President of the United States and Senior
Fellow, Hoover Institution
Dr. Chi-Fu Huang Long Term Capital Management
Prof. Weiping Huang Director, Pacific Economic Institute at
People's University of China
Mr. Mark Kritzman Founding partner, Windham Capital Management
Dr. Joe Langsam Principal and Head of the Fixed Income
Research, Morgan Stanley
Prof. Yining Li Deputy Director, Legislation Committee of the
People's Congress and Dean, Business School of
Beijing University
Prof. Merton H. Miller Nobel Economics Laureate, University of Chicago
Prof. Franco Modigliani Nobel Economics Laureate, MIT
Dr. Yan Wang Economist, World Bank
Mr. Jinglian Wu Senior Research Fellow, Development and Research
Center of the State Council of China
Conference Program
PRELIMINARY PROGRAM
Third Annual Conference of the Chinese Finance Association (CFA)
New York, New York
September 20-21, 1996
Sept. 20 (Friday)
8:00 - 9:00 Registration
9:00 - 9:30 Opening Speech
Speaker: Steve Sun, CFA President
9:30 - 12:30 Panel Discussion
Panelists:
Jiangshu Ruo, Vice General Manager, Bank of China (New York)
Susumu Awanohara, Advisor, Nikko Securities
Richard Farrell, Manager, Guinness Flight
12:30 - 14:00 Luncheon
14:30 - 15:30 Keynote Speech
Speaker:
Huang Da, Vice Chairman of Finance and Economics Committee,
National People's Congress
15:30 - 17:30 Mini-Conference
Speakers:
Huang Weiping, Director, Asia-Pacific Economic Center, People's
University of China
Kevin Kime, Senior Economist, New York FED
18:00 - 21:00 Dinner Reception
Speaker:
Shengman Zhang, Vice President, The World Bank
Sept. 21 (Saturday)
9:30 - 11:30 Presentation of Accepted Papers
"Vega-Hedging: An Antidote for Model Misspecification"
By
Ehud I. Ronn and Changneng Xuan, Univ. of Texas
"Dividend Policy: New Insights from a Comparative Study
of Hong Kong and the United States"
by
Thomas J. Chemmanur and Y. Helen Liu, Columbia Univ.
"Bayesian Estimates of Local Volatility Using High,
Low and Close Prices"
by
Tongshu Ma, Univ. of Minnesota
"When and Why are Thrifts Resolved?"
by
Lin Guo, Boston College
11:30 - 12:30 Recruiting Presentation Session
Speakers:
Gang Chu, Citicorp
Jennifer Sun, Wang & Li Asian Resources
12:30 - 14:00 Lunch
14:30 - 15:00 Closing Remarks
Speaker: Guojun Wu, CFA Chairman
15:00 - 16:00 Election of officers