Rural chinese lender seeks hong kong ipo to recapitalize – nikkei asian review

The eight-year-old lender, which expanded by buying and consolidating other banks in villages and townships, said in its IPO prospectus that the net proceeds from the offering would strengthen its capital base and support the growth of its business.

“Regarding our future merger, acquisition, and targets, we haven’t come to a conclusion yet,” Gao Bing, Jilin Jiutai’s chairman, told reporters on Friday. Meaning of rural bank “Any concrete plan would depend on market development and our expansion needs.”

Of the 353 outlets that Jilin Jiutai controls in 10 provinces and municipalities, 250 are through subsidiary banks, which represented 44.8% of the group’s total assets amounting to 159.97 billion yuan ($23.02 billion) as of June.

These subsidiaries included five rural commercial banks restructured from various rural credit cooperatives and a rural cooperative bank that Jilin Jiutai previously acquired, as well as 32 village and township banks in the city of Tianjin and provinces such as Heilongjiang, Hebei, Shandong, Anhui, Hubei, Shaanxi, Guangdong, and Hainan. Rural bank notification They operated autonomously as separate legal entities with their own brand names.

Similar to other Chinese lenders plagued by deteriorating asset quality, Jilin Jiutai saw the combined ratio of its nonperforming and special-mention loans climb to 4.67% in June from 3.86% at the end of 2013. Regional rural bank pdf In its corporate loan book, the mining sector has the highest NPL ratio at 8.38%, followed by manufacturing at 2.8%.

Jilin Jiutai’s off-balance sheet commitments jumped fourfold to 3.26 billion yuan between 2013 and 2015, as investments in various debt instruments, including asset management plans, trust plans, wealth management products, and beneficiary certificates totaled 32.03 billion yuan as of June, representing 20% of its total assets.

That partly explained how the bank recorded a 70.3% year-on-year jump in net profit to 866.6 million yuan for the six months ended in June, in spite of net interest margin shrinking to 2.56%.

With Guotai Junan Capital, an offshore subsidiary of the Shanghai-based investment bank, as the sole sponsor, Jilin Jiutai expects its first-time share sales to be priced on Jan. Regional rural bank notification 2015 5 and trading on the bourse to begin Jan. Regional rural bank exam 12

It also enlisted the investment banking arms of state-owned China Construction Bank, Agricultural Bank of China, and Haitong Securities as bookrunners for the transaction.

The consortium had locked in two cornerstone investors for around 27% of the issue, namely China Create Capital, an investment holding company, and Suhang Investment Holdings which is affiliated with distressed asset manager China Huarong International Holdings. R r b regional rural bank China Create Capital had entered into a loan facility agreement with CCB International Securities.

New share sales by Chinese lenders have been rising steadily amid China’s economic downturn. Regional rural bank merger Their total volume leapt by more than seven times to $16.08 billion since 2012, according to financial data provider Dealogic.

While Chinese banks traditionally favored Hong Kong as a listing destination, which had attracted 17 listings over the past five years, more are now turning to the mainland A-share markets for higher valuations, especially city commercial banks. Regional rural bank act 1976 Shanghai and Shenzhen had altogether pulled in 4.54 billion yuan from nine deals.

At least eight Hong Kong-listed mid-size mainland banks are seeking to also list in the A-share market to expand their capital base. Regional rural bank wiki Bank of Qingdao, listed in Hong Kong a year ago, said on Dec. Regional rural bank previous year question papers 16 that the regulator was processing its application to float no more than one billion shares on the Shenzhen stock exchange.

Bank of Chongqing, listed in Hong Kong in 2013, was the latest bank approved by the China Banking Regulatory Commission to float on the A-share market.