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Huarong to sell bad debts in New York
By Patricia Cheng (China Daily)
Updated: 2005-09-22 08:40
China Huarong Asset Management Corp, one of the nation's four State-owned bad-debt managers, will meet investors in New York this month to sell more bad loans.
"We'll do an international roadshow in September," Su Qinghua, an official at the Beijing-based company, said. A team of seven people left for New York on Tuesday, he said.
China set up Huarong, Orient Asset Management Corp, Cinda Asset Management Corp and Great Wall Asset Management Corp in 1999 to clean the balance sheets of the four biggest state-owned banks.
Avenue Capital Group, a US investor that manages US$7 billion of distressed assets, bought loans with a face value of 5 billion yuan (US$618 million) from Cinda this month.
"The recent acquisition by Avenue and the Huarong roadshow are a positive sign that the non-performing loan activity is back to the market," said Mike Harris, a Beijing-based partner at PricewaterhouseCoopers LLP.
China's banks became saddled with loans built up during decades of government-directed lending to unprofitable businesses.
The nation moved 1.4 trillion yuan (US$173 billion) of loans to the four debt managers in 1999 and more than 500 billion yuan (US$61.7 billion) of loans in subsequent transfers.
The Avenue purchase has been the only publicly announced sale to a foreign buyer since April.
(China Daily 09/22/2005 page11)
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