Industrial Bank and Everbright Bank are investigated! Hundreds of billions of state-owned enterprise bonds default

category:Finance
 Industrial Bank and Everbright Bank are investigated! Hundreds of billions of state-owned enterprise bonds default


The association of dealers launched self-discipline investigation on Industrial Bank, Everbright Bank and Zhongyuan bank

In the evening of November 19, the association of dealers conducted self-discipline investigation on Yongcheng Coal and Power Holding Group Co., Ltd. and interviewed a number of intermediaries, and found that the main underwriters such as Industrial Bank Co., Ltd., China Everbright Bank Co., Ltd. and Zhongyuan Bank Co., Ltd., as well as China integrity International credit rating Co., Ltd. and Xigema accounting firm (special general partnership) is suspected of violating the self regulatory management rules of the inter-bank bond market.

In accordance with the relevant provisions of the rules on self discipline in the interbank bond market, etc., the association of dealers will launch a self-discipline investigation on relevant intermediaries.

On the 18th, the association of dealers in the interbank market issued a notice saying that recently, the association of dealers conducted a self-discipline investigation on Yongcheng Coal and Power Holding Group Co., Ltd. (hereinafter referred to as Yongcheng Coal Holdings). According to the clues obtained from the investigation and in combination with the relevant market trading information, it is found that Haitong Securities and its related subsidiaries are suspected of providing assistance for the issuer in issuing bonds in violation of regulations, and are suspected of manipulating the market and other illegal behaviors, involving debt financing instruments of non-financial enterprises in the inter-bank bond market and corporate bonds in the exchange market.

The association of dealers said it would conduct a self-discipline investigation on Haitong Securities and its related subsidiaries in accordance with the self regulatory rules of the interbank bond market. If it is found in the investigation that the relevant institutions have such bad behaviors as manipulating the market and disturbing the market order, the dealers association will impose strict self-discipline punishment and hand it over to the relevant departments for further treatment.

Subsequently, Haitong Securities announced in response that the company will actively cooperate with the relevant work of self-discipline investigation, strictly implement the relevant requirements of the notice on Further Strengthening the regulation of debt financing instrument issuance business issued by the association of dealers, and timely fulfill the obligation of information disclosure.

The association of dealers is a self regulatory organization of the inter-bank market, including the inter-bank bond market, the inter-bank lending market, the foreign exchange market, the bill market and the gold market. Its competent department is the peoples Bank of China.

Affected by the news, Haitong Securities shares fell 6% on the 19th.

On the evening of November 18, the association of dealers issued the notice on Further Strengthening the regulation of issuing business of debt financing instruments, which explicitly prohibited the structured issuance of bonds, and required the issuers not to subscribe directly, or actually contributed by the issuers, but indirectly subscribed for the debt financing instruments issued by themselves through affiliated institutions, asset management products, etc Relevant commitments are made in the case and confirmed in the issuance announcement. Underwriters and investors shall not intentionally assist the issuer in self financing

Event review

On November 10, Yongcheng Coal and Power Holding Group Co., Ltd. issued an announcement, saying that due to the shortage of working capital, the third phase of ultra short-term financing bonds 20 Yongmei scp003 in 2020 could not fully repay the principal and interest, which constituted a substantial breach of contract.

As there was no sign in advance, the default of Yongmei Group caused an uproar in the market due to the issuance of a one billion yuan winning vote 20 days before the default.

As a core enterprise subordinate to Henan energy and chemical industry group, the largest state-owned enterprise in Henan Province, Yongmei holdings had monetary assets of more than 40 billion yuan by the end of September, but it could not even take out 1 billion yuan.

The day after the unexpected explosion of Yongmei holdings, the butterfly effect appeared rapidly. Cicci quickly lowered the main rating of Yongmei holdings and its controlling shareholder, Yu Neng Hua group, from AAA to BB, and was listed in the degradation observation list. A number of coal enterprises, urban investment, local state-owned enterprises at home and abroad bond continued to decline.

As the parent company of Yongmei holding 96.01% of its shares, Henan energy and chemical group, affected by this, has lowered its credit rating from AAA to BB, which makes the outside world worry about its involvement in the risk of cross default. On the 19th, according to the 21st century economic report, Yuneng chemical and its main contractor called the holders of 20 permanent coal scp003 to hold a pre communication meeting to discuss the extension of 20 permanent coal scp003. However, some creditors do not agree to the extension plan, which means that 26.5 billion Yuneng chemical and permanent coal bonds may trigger cross default. According to the statistics of CICC, the volume of the existing bonds of Yongcheng Coal and Henan Energy Chemical Co., Ltd. is close to 50 billion yuan, and the total amount of all public bonds of parent and subsidiary companies is 26.5 billion yuan, and cross protection clauses are set up. Among them, 15 branches of Yongcheng Coal and 10 bonds of Henan Energy Chemical Co., Ltd. totaled 15 billion yuan and 11.5 billion yuan respectively. If cross default is confirmed, it may lead to further increase of short-term centralized cashing pressure of enterprises. CICC said. Source: Chen Hequn, editor in charge of China fund daily_ NB12679

As the parent company of Yongmei holding 96.01% of its shares, Henan energy and chemical group, affected by this, has lowered its credit rating from AAA to BB, which makes the outside world worry about its involvement in the risk of cross default.

On the 19th, according to the 21st century economic report, Yuneng chemical and its main contractor called the holders of 20 permanent coal scp003 to hold a pre communication meeting to discuss the extension of 20 permanent coal scp003. However, some creditors do not agree to the extension plan, which means that 26.5 billion Yuneng chemical and permanent coal bonds may trigger cross default.

According to the statistics of CICC, the volume of the existing bonds of Yongcheng Coal and Henan Energy Chemical Co., Ltd. is close to 50 billion yuan, and the total amount of all public bonds of parent and subsidiary companies is 26.5 billion yuan, and cross protection clauses are set up. Among them, 15 branches of Yongcheng Coal and 10 bonds of Henan Energy Chemical Co., Ltd. totaled 15 billion yuan and 11.5 billion yuan respectively.

If cross default is confirmed, it may lead to further increase of short-term centralized cashing pressure of enterprises. CICC said.