trending Market Intelligence /marketintelligence/en/news-insights/trending/XActnWXktQMq7XG-zGEWvA2 content esgSubNav
In This List

Agricultural Bank of China to sell NPL-backed securities

Blog

Balance Sheet Strategy in an Unusual Rate Environment

Blog

Investors' Views of the Industry Today & the Outlook for Tomorrow

Podcast

Street Talk | Episode 98: Regulatory scrutiny having cooling effect on community bank M&A

Blog

Insight Weekly: M&A outlook; US community bank margins; green hydrogen players' EU expansion


Agricultural Bank of China to sell NPL-backed securities

AgriculturalBank of China Ltd. plans to sell securities backed by 10.7 billionyuan of nonperforming loans, Bloomberg News reported July 25, citing astatement from the bank on the website of China's main bond clearinghouse.

The bank said it will issue two tranches of the NPL-backedsecurities, made up of a 2.06 billion yuan senior tranche and a 1 billion yuansubordinated tranche. The lender will sell the securities at 29% of the loans' facevalue, while the recovery rate on the debt is forecast is at 41%.

Chinese commercial banks have been to issue NPL-backed securitiesunder a pilot program as the banking sector grapples with rising bad loans. Thecountry's banking regulator said July 15 that the NPL securities program willbe expanded, but did not provide further details.

Bank of ChinaLtd. and ChinaMerchants Bank Co. Ltd. issued a total of 534 million yuan of NPL-backedsecurities in May.

As of July 22, US$1was equivalent to 6.68 Chinese yuan.