News Column

Bad Loans Find New Buyers in 5 Provinces, Municipalities

July 29, 2014

BEIJING, July 29, SinoCast -- A person in the know revealed that the China Banking Regulatory Commission has approved setup or licensing of local asset management companies to purchase bad loans from financial institutions in five provinces and municipalities including Shanghai, Guangdong, Zhejiang, Jiangsu and Anhui. Banks, trust, financial and financial leasing companies can sell bad loans to them.

Earlier, only a few asset management companies including China Huarong Asset Management Corporation (CHAMC), China Orient Asset Management Corporation (COAMC) and China Cinda Asset Management Company, Ltd. are licensed to deal with bad loans.

By the end of the first quarter, bad loans in the Chinese banking industry had reached CNY 646.1 billion or USD 104 billion, in contrast to CNY 592.1 billion by the end of 2013. Bad loan ratio has climbed to 1.04%, new high within three years.

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Source: Sinocast Investing & Securities Beat (China)

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