How to deal with the business after the bankruptcy of the Contractors Bank

category:Finance
 How to deal with the business after the bankruptcy of the Contractors Bank


According to the announcement, Huishang banks acquisition of contractor banks includes target business, target assets, target liabilities and target personnel. The full text of the announcement is 9 pages long.

Source: announcement of Huishang bank

Among them, the following businesses and assets involved in the bookkeeping dimension of the four branches include:

Firstly, the following business and corresponding assets recorded in the book of four branches of the subcontractor Bank: corporate loan, retail loan, deposit business, trust loan, equity investment, bond investment and non clean statement, interest receivable and other receivables, etc;

The second is the off balance sheet business and assets recorded by the four branches of the subcontractor Bank: off balance sheet acceptance bill, letter of guarantee and entrusted loan;

The third is the book intermediary business of the four branches of the subcontractor bank, including financial management, funds, insurance, bonds, financial derivatives, trust and asset management products;

Target liabilities include due and unpaid as of the transaction base date as follows: deposits from interbank and other financial institutions, deposits received, employee compensation payable, interest payable, estimated liabilities, other accounts payable and other liabilities. The target liabilities do not include the liabilities under the custody business and the financial management business carried out by the four branches of the subcontractor bank.

Is take over good or bad?

Huishang bank announced that as of the transaction base date, the book value of the assets under the acquisition undertaking and the total liabilities of the subcontractor bank undertaken by Huishang bank were 98.382 billion yuan, the asset appraisal value was 65.347 billion yuan, and the business value was 15.3 billion yuan. The bank is not required to pay cash to the subcontractor bank for this acquisition undertaking.

With the unanimous agreement of the subcontractor bank, the bank and the deposit insurance fund, the amount of the balance between the banks undertaking liabilities and the purchase assets appraisal value shall be deducted from the amount of business value to be paid by the bank. The total amount of the remaining amount is 17.735 billion yuan. Within 30 working days after the signing of the acquisition undertaking agreement, the deposit deposited with the bank shall be used by the deposit fund to pay to the designated account of the bank Pay.

Huishang bank said that the acquisition undertaking agreement was concluded on normal commercial terms after fair negotiation among the contracting parties. The terms and conditions of the agreement are fair and reasonable and in line with the overall interests of the bank and its shareholders.

Short term cash flow Huishang bank does not need to pay a cent. Instead, it can obtain corresponding support from the central bank deposit insurance fund in the initial stage. However, due to the large amount of impairment reserves, the liquidity needs to be enhanced in the medium and long term, and the capital needs to be enhanced in the short term to support the scale of asset liability business.

With regard to the business value of 15.3 billion yuan of the four branches, Xiao Liang said frankly, at present, both the state-owned large banks and the joint-stock banks P / B ratio is significantly lower than 1, and only a few high-quality banks are higher than 1. The four branches of the subcontractor bank can not be better than the four major banks and joint-stock banks. The so-called business value is to give the premium part with the price to book ratio higher than 1, so it can not reflect the business value temporarily. However, from the perspective of Huishang bank, it can achieve leapfrog expansion opportunities, which belongs to regulatory policy dividend. In addition, from the overall layout and long-term operation and development, the four branches may give Huishang bank competitive strategic advantages.

On May 24, 2019, due to serious credit risk, the subcontractor bank was jointly taken over by the peoples Bank of China and the China Banking and Insurance Regulatory Commission. The takeover group fully exercises the operation and management rights of the subcontractor bank, and entrusts CCB to trust the business of the subcontractor bank.

In June 2019, in order to find out the family background of the Contractors Bank, the takeover team employed an intermediary agency in a market-oriented way to check the corporate and inter-bank business of the subcontractor bank one by one, and carried out asset and liability inventory, accounting clearance, value revaluation and capital verification, and comprehensively mastered the asset status, financial status and operation situation of the subcontractor bank.

In January 2020, the takeover group, in accordance with the market-oriented principle, entrusted Beijing financial assets exchange to select Huishang bank as the merger and acquisition Party of four branches outside Inner Mongolia Autonomous Region, and determined the subscription share and share price of the shareholders of the newly established bank, namely, mengshang bank.

On April 30, 2020, Mongolian Commercial Bank was officially established and opened. On the same day, the takeover group of the subcontractor bank issued the announcement on the transfer of related business, assets and liabilities of the subcontractor Bank Co., Ltd., which transferred the relevant business, assets and liabilities to mengshang bank and Huishang bank respectively. According to Article 18 of the regulations on deposit insurance, the deposit insurance fund provides financial support to the Mongolian Commercial Bank and Huishang bank, and shares the asset impairment loss of the original contractor bank, so as to facilitate the smooth acquisition, undertaking and smooth operation of the relevant business. On November 23, 2020, the official website of China Banking and Insurance Regulatory Commission (CIRC) announced the official reply on the bankruptcy of the contractor Bank Co., Ltd., which said that the contractor bank was allowed to enter the bankruptcy procedure in principle. On the same day, the Beijing first intermediate peoples Court issued a civil ruling showing that the court accepted the bankruptcy liquidation application of the contractor Bank Co., Ltd. Source: China Securities Journal Editor in charge: Yang Bin_ NF4368

On April 30, 2020, Mongolian Commercial Bank was officially established and opened. On the same day, the takeover group of the subcontractor bank issued the announcement on the transfer of related business, assets and liabilities of the subcontractor Bank Co., Ltd., which transferred the relevant business, assets and liabilities to mengshang bank and Huishang bank respectively. According to Article 18 of the regulations on deposit insurance, the deposit insurance fund provides financial support to the Mongolian Commercial Bank and Huishang bank, and shares the asset impairment loss of the original contractor bank, so as to facilitate the smooth acquisition, undertaking and smooth operation of the relevant business.

On November 23, 2020, the official website of China Banking and Insurance Regulatory Commission (CIRC) announced the official reply on the bankruptcy of the contractor Bank Co., Ltd., which said that the contractor bank was allowed to enter the bankruptcy procedure in principle. On the same day, the Beijing first intermediate peoples Court issued a civil ruling showing that the court accepted the bankruptcy liquidation application of the contractor Bank Co., Ltd.