What does it mean to package and dispose of financial non-performing assets?

The asset management company transfers the bank's non-performing creditor's rights to the buyer through packaging (concentrating the bank's non-performing assets in a certain area of a bank), auction (for ordinary buyers) and agreement transfer (for SASAC, etc.). ), and get the corresponding consideration. It used to be policy disposal, but now it has been gradually commercialized.

Non-performing assets is a very broad concept, including non-performing assets of banks, enterprises, securities and funds. Today, I will talk about the most important non-performing assets, that is, the non-performing assets of banks, that is, loans that borrowers cannot repay the principal and interest at maturity, also known as non-performing loans.

What is the disposal of non-performing assets?

The disposal of non-performing assets is to deal with some non-performing loans of banks that cannot be repaid on time in order to recover the principal and interest. Before 1998, the risk control system of Chinese banks was "one overload and two retention", namely "overdue", "sluggish" and "bad debts". After 1998, assets are divided into five categories: normal, concerned, secondary, suspicious and loss, of which the latter three categories are non-performing assets. According to the prediction of relevant institutions, the scale of non-performing assets in China will reach nearly 3 trillion in 2020, of which banks account for the majority.

How to deal with non-performing assets?

Generally speaking, the disposal procedure of non-performing assets is internal collection first, and then outsourcing collection. There is a special collection agency inside the bank, and outsourcing means outsourcing to a professional collection company outside.

In addition, there is a giant company that is responsible for the disposal of non-performing assets of banks. They are four state-owned asset management companies (AMC): Huarong Asset Management Company, Great Wall Asset Management Company, Cinda Asset Management Company and Dongfang Asset Management Company. These four banks were established in the State Council on 1999 to deal with the non-performing assets of state-owned banks. Four asset management companies are connected with four state-owned banks: China Agricultural Bank, China Construction Bank and China Industrial and Commercial Bank.

Mainly through the way of "debt-to-equity swap", asset management companies use funds to buy non-performing assets of banks, and convert the bank's creditor's rights to enterprises into equity of asset management companies, so that asset management companies become shareholders of enterprises and get equity dividends. Through this procedure, these enterprises have walked out of the quagmire, continued to develop in a good direction, and finally recovered their original shareholding funds through transfer, reorganization or listing. In this way, the bank's non-performing assets have been solved, and those enterprises that are deeply mired in the quagmire have gradually got rid of the predicament and normal production and operation.

"Debt-to-equity swap" is mainly aimed at enterprises with high quality conditions in all aspects. What about enterprises or companies with average qualifications? Usually, banks will package and discount such non-performing assets to asset management companies. For example, ABC packages non-performing assets in proportion, with the first category accounting for 65,438+00%, the second category accounting for 30%, the third category accounting for 30% and the fourth category accounting for 30%, that is, the proportion of high-quality creditor's rights is the least. Suppose this asset package is worth 654.38 billion yuan and sold to Great Wall Asset Management at a 20% discount, that is, Great Wall Asset Management spent 200 million yuan to get this asset package, digested and disposed of its high-quality, old and intractable price, and sold it to some local asset management companies. Buy at a low price, sell at a high price, and recover the principal and interest of the enterprise. In any case, asset management companies finally make money, and the profits are not generally rich. It is no exaggeration to say that the disposal of non-performing assets is a profiteering industry.

Significance of disposing of non-performing assets

Finance is the core and pillar of economy. Tracing back to the source, banks are the source of finance. With the decline of the overall domestic economic growth rate, the non-performing assets of banks are gradually rising. If not handled, it will inevitably lead to systemic financial risks in the long run. The disposal of non-performing assets can minimize risks and revitalize assets. Through "debt-to-equity swap", bankruptcy, enterprise reorganization and merger, we will maximize the exploitation of high-quality assets and make the allocation of resources more optimized and reasonable. The orderly and healthy development of finance can guide the optimal allocation of capital resources in various real industries, which undoubtedly plays a very important role in promoting and influencing the sustainable development of the economy.