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Huarong finishes handling of non-performing assets

(Xinhua)
Updated: 2007-02-19 17:09

China Huarong Asset Management Corporation (AMC) announced Monday that it has finished the handling of non-performing assets with a book value of 320.4 billion yuan (US$41.3 billion) by the end of 2006.

The company said it has retrieved 57.57 billion yuan in cash from the non-performing assets, or 100.12 percent of the cash-back task required by the State Council.

Huanrong AMC is one of the four AMCs established in 1999 to handle a combined volume of 1.4 trillion yuan of non-performing loans transferred from the biggest four State-owned commercial banks and the China Development Bank.

Statistics from Huarong show that its cash recovery rate is 17.968 percent, and the company has managed to maintain a low cost for handling the non-performing assets, which is about 5.57 yuan for recovering each 100 yuan in cash.

President of Huarong AMC Ding Zhongchi said the next step for his company is to focus on reforms toward commercialization, i.e., to develop into a modern financial corporate group which provides financial services including asset management, investment banking, financial lease, warranty and trust businesses.

Sources from the China Banking Regulatory Commission said earlier that they are mulling over ways to transform the four AMCs into commercial financial institutions once they finish the disposal of the non-performing loans.