Major bad debt manager plans 108 bln yuan for 2019 toxic asset disposal
China Great Wall Asset Management Corporation (Great Wall), one of the country's biggest distressed debt managers, mulls allocating 108 billion yuan (16.03 billion U.S. dollars) to buy non-performing assets.
The company plans to spend 60 billion yuan (8.9 billion U.S. dollars) to purchase financial non-performing capital and 48 billion yuan (7.1 billion U.S. dollars) for non-financial bad assets, respectively.
It bought bad financial assets worth 179.2 billion yuan (26.5 billion U.S. dollars) last year, up 20 percent year-on-year. Regarding conducting debt-to-equity swaps, Great Wall completed the debt-to-equity swap project on China Railway Materials Commercial Corp (CRM), a primary Chinese rail infrastructure provider. The project started in 2016 and is the first case of a private equity debt default project on the central state-owned enterprise. Asset restructuring brought the 2017 leverage ratio done by 12 percent.
Great Wall also plans to spend 10 billion yuan (1.48 billion U.S. dollars) for acquisitions and reorganizations as part of its program to operate 100 such projects in two to three years.
Great Wall is among China's four asset management firms set up in 1999 to deal with the toxic assets of the country's four big state-owned banks in a bid to help transform them into market-oriented financial institutions.