① Minmetals Finance's 604.113.15 million Guangfa Bank shares were re-listed and transferred. The reserve price was reduced to 564 million yuan, a 10% discount from the previous one. ② Sinopec Finance's public listing transfer of 367.21.52 million Guangfa Bank shares expired today, and no buyers have been found. ③ Regulations have forced finance companies to “sell off” financial institution shares, and central state-owned enterprises are all speeding up the sell-off of financial equity by removing non-main investments.
Finance Association, May 14 (Reporter Zou Juntao) A small portion of Guangfa Bank's shares held by Minmetals Finance was re-listed and transferred, and the relevant transfer price was reduced by 10%.
On May 14, the Beijing Equity Exchange revealed that Guangfa Bank's 604.113.15 million shares (0.2772% of the total share capital) were re-publicly listed and transferred, and the transfer reserve price was reduced to 56.421 million yuan. The disclosure of this information will commence on May 15, 2024.
It is worth noting that Guangfa Bank's public listing and transfer of another 36.721.52 million shares (0.0169% of the total share capital) expired today, but there is currently no information showing that it has found a buyer. The seller is Sinopec Finance, a finance company under the Sinopec Group.
A Financial Services Association reporter noticed that with regulatory policies being imposed, there have been frequent incidents of finance companies “selling” financial institution shares recently. In recent years, the pace of investment by central state-owned enterprises has been speeding up the withdrawal of financial enterprises that are not related to their main business.
Minmetals Finance was listed for the second time, and Guangfa Bank's shares were directly discounted by 10%. Sinopec Finance has yet to find a buyer
According to listing information, the equity transferee is Minmetals Group Finance Co., Ltd. (“Minmetals Finance” for short), a subsidiary of China Minmetals Group. In September 2023, China Minmetals Group Co., Ltd. issued a board resolution approving the “Opinions on the Finance Company's 0.2772% Equity Transfer Project of Guangfa Bank Co., Ltd.”
According to reports, in September 2023, Minmetals Finance publicly listed and transferred 604.113.15 million shares of the Guangfa Bank mentioned above. At that time, the reserve price for the transfer was 626.9 million yuan. The listing starts and ends on September 26, 2023 to October 27, 2023.
However, as of the expiration of the last listing period, the 604.113.15 million shares of Guangfa Bank mentioned above had not found a “successor.” In contrast, Minmetals Finance's reserve price for the transfer of shares in Guangfa Bank this time is 10% off compared to last year.
Furthermore, the Finance Association reporter noticed that in addition to Minmetals Finance, Sinopec Finance Co., Ltd. (“Sinopec Finance” for short) is also transferring shares in Guangfa Bank.
On December 14, 2023, the Capital and Finance Division of China Petroleum & Chemical Group Co., Ltd. approved the public transfer of shares of Guangfa Bank Co., Ltd. by the finance company.
On March 25 of this year, Sinopec Finance publicly listed and transferred 672.15 million shares of Guangfa Bank (0.0169% of the total share capital) on the Beijing Equity Exchange, with a reserve transfer price of RMB 34.2021 million. The listing information disclosure deadline is 2024/05, which is today. However, as of press release, the listing information is still there, which means that no buyers have been found.
Both finance companies mentioned above were “liquidated” and transferred shares. The two equity transfer announcements require that the intended transferee shall be a legal person, unincorporated organization or natural person with full civil capacity established by law, and shall also have good financial status, ability to pay and commercial credit, and meet other conditions stipulated in relevant national laws and regulations.
According to data, Guangfa Bank was established in 1988, formerly known as Guangdong Development Bank. It was approved by the State Council and the People's Bank of China, and was one of the first batch of national joint-stock commercial banks established in China. In August 2016, Guangfa Bank became a member unit of China Life Insurance Group.
The 2023 annual report revealed that the bank achieved net profit attributable to the bank's common shareholders of 13.994 billion yuan last year, an increase of 3.63% over the previous year. By the end of last year, Guangfa Bank's total assets had exceeded 3.5 trillion yuan, and total liabilities had reached 3.2 trillion yuan.
Regulatory rules are forcing finance companies to speed up the “sale” of financial shares
A Financial Services Association reporter noticed that there have been many cases of finance companies “selling off” financial institution shares recently, and there is pressure from regulatory rules behind them.
In October 2022, the former China Banking Insurance Regulatory Commission revised and issued the “Administrative Measures on Enterprise Group Finance Companies” (hereinafter referred to as the “Measures”) to regulate the behavior of enterprise group finance companies (“finance companies”), prevent financial risks, and promote the steady operation and healthy development of finance companies
The newly revised “Measures” require further strengthening the main business of finance companies, focusing on serving within the group, and returning to the roots of serving the real economy. Article 22 of the Measures stipulates, “Finance companies shall not issue financial bonds and shall not invest in financial institutions and enterprises.”
On the evening of May 9, Huatai Insurance Group Co., Ltd. (“Huatai Insurance”) announced that Shenzhen Energy Finance Co., Ltd. (“Shenzhen Energy Finance”) plans to transfer all of its 12,200,000 shares (0.3034%) of Huatai Insurance shares to Shenzhen Energy Group Co., Ltd. (“Shenzhen Energy” for short).
The official reason given by Shenzhen Energy is that according to the “Administrative Measures on Enterprise Group Finance Companies” issued by the State Administration of Financial Supervision and Administration, finance companies are not allowed to invest in financial institutions and enterprises. Therefore, Shenzhen Energy Finance cannot continue to hold shares in Huatai Insurance.
It is worth mentioning that in response to previous requirements of the State Council's State-owned Assets Administration Commission to “return to the roots, focus on the main business, and strictly control non-main investment,” the pace at which central state-owned enterprises have cleaned up equity investment in financial institutions such as small and medium-sized banks has also accelerated in recent years.