banking system & ldquo; Debt to equity swap & rdquo; The company may increase its capital one after another. What is the reason

on December 2, China Construction Bank announced that the bank had issued an announcement to its wholly-owned subsidiary CCB financial asset investment Co., Ltd. (hereinafter referred to as & ldquo; CCB Investment & rdquo;) The amount of capital increase shall not exceed 30 billion yuan

a number of people from banking financial asset investment companies told Chinese reporters that CCB's announcement may open the curtain of capital increase of many banking financial asset investment companies (AICS), It is expected that banks will successively announce relevant capital increase plans in the future. Behind the collective capital increase of AIC, there is not only the natural need for capital supplement with the expansion of debt to equity swap business, but more importantly, the regulatory authorities have recently made clear the capital adequacy requirements for AIC within three years. Companies need to replenish capital in time to meet regulatory requirements

the regulation specifies the three-year capital adequacy assessment requirements of AIC

the capital increase of CCB to CCB investment will be carried out in stages. The announcement said that the first capital increase was RMB 15 billion, and the board of directors of the bank authorized the management to decide the specific matters of subsequent capital increase within the amount of capital increase determined by the board of directors

banking financial asset investment companies are mainly engaged in market-oriented debt to equity swap business. As a wholly-owned subsidiary of CCB, CCB investment currently has a registered capital of 12 billion yuan and was approved to be established in 2017. At the end of 2019, the audited total assets of CCB investment were 102.680 billion yuan, and the net assets were 12.417 billion yuan; The audited net profit in 2019 was RMB 287 million

a number of AIC people told the Chinese reporter of the securities firm that CCB is not the only financial asset investment company that needs to increase capital in the near future, and it is expected that more banks will announce the capital increase plans for their financial asset investment subsidiaries in the future& ldquo; Collective action & rdquo; This is mainly due to the fact that the regulatory authorities have recently made clear the capital adequacy requirements for financial asset investment companies within three years

“ According to the latest regulatory requirements, the capital adequacy ratio of most AICS should reach 5% by the end of this year, 6% by the end of next year and 8% by the end of the following year& rdquo; A person from a financial asset investment company in Beijing told a Chinese reporter of a securities firm

another AIC person also confirmed the above information. The person said that since AIC is an emerging institution that responds to the state's promotion of market-oriented debt to equity swap, since its establishment in 2017, the regulatory authorities have not put forward clear assessment requirements for AIC's capital adequacy ratio. With the operation of various institutions on track, the assessment requirements for capital adequacy ratio are set with reference to other financial institutions engaged in similar businesses, which meets the regulatory requirements of consistency and fairness. At present, the capital adequacy ratio of major financial asset investment companies is about 2% and 3%, and the capital increase can meet the regulatory assessment

the problem of capital occupation remains to be solved

so far, five AICS have opened, including five holding subsidiaries of large state-owned banks: industry, agriculture, China Construction and communications. In addition, four banks announced plans to set up AIC, namely Ping An Bank, industrial bank, Guangzhou agricultural and commercial bank and Shanghai Pudong Development Bank

according to the data previously released by the central bank, by the end of 2019, the investment scale of market-oriented debt to equity swap had exceeded 1.4 trillion. Many people in the industry told Chinese reporters of securities companies that in the past four years since the implementation of market-oriented debt to equity swap, banks still have high capital occupation and limited exit channels; Old and difficult & rdquo; Question. Especially in terms of capital occupation, some joint-stock banks announced their plans to set up AIC as early as 2018, but a major reason for the delay is that the capital consumption of debt to equity swap business is high, which will undoubtedly further add to the already tight capital pressure of most banks