Finance Association, May 23 (Reporter Li Jie) Vanke has made significant progress on the financing side.

The reporter learned that Vanke has signed agreements with leading financial institutions such as China Merchants Bank to obtain 20 billion yuan syndicated loans. The collateral is Vanke's Wanwei Logistics shares, which have received 10 billion yuan so far.

Vanke said that this 20 billion syndicated loan will help the company further enhance its liquidity, reflecting the strong support of financial institutions such as China Merchants Bank for the company.

“The company has always maintained a good cooperative and trusting relationship with financial institutions, and is actively promoting various types of financing cooperation. In the next step, the company will continue to act firmly, and has the confidence and ability to proactively and comprehensively complete the transformation of the financing model while properly handling maturing debts.” According to Vanke.

Industry insiders analyzed that this is the largest single syndicated loan amount provided by financial institutions to housing enterprises since 2020.

“Due to the large amount of money, syndicated financing methods require joint approval from multiple banks, so the qualifications of borrowers are very high. In recent years, only leading domestic central enterprises have received large syndicated loans. This loan reflects the financial market's full recognition of Vanke's reputation.” Analysts said.

According to reports, the collateral for this syndicated loan is Wanwei Logistics Co., Ltd., a subsidiary of Vanke. According to the National Enterprise Credit Information Publicity System, Vanke sold shares of about 27 billion yuan in the development of its subsidiary Vanke Logistics. The pledge holder is China Merchants Bank Shenzhen Branch. According to the publicity system, the equity issuance has been effective since May 20.

After Vanke's financial crisis this year, Vanke's related actions attracted much attention from the market. Meanwhile, at the 2023 Vanke Shareholders' Meeting held on April 30, Yu Liang, chairman of Vanke's board of directors, made it clear that Vanke will focus on its main business, free up limited resources, and do a good job in strengthening the three main businesses of integrated residential development, property services, and rental apartments.

Yu Liang said that in terms of “reducing debt,” Vanke will reduce its interest-paying debt by more than 100 billion yuan in the next two years, and the total amount of interest-paying debt will be reduced by more than half in the next five years; secondly, it will complete the “transformation of the financing model”, gradually shifting from a model based on total loan repayment and principal credit to a financing model centered on project and asset credit.

“The company will focus on three areas of work. The first is to implement a real estate financing coordination mechanism to fully report; the second is to vigorously promote operational property loans, which can not only solve stock problems, but also obtain new liquidity in stages; third, actively promote syndicated loans to improve the efficiency of bank-enterprise cooperation, which has now received quite a bit of bank support.” Vanke President Zhu Jiusheng said at the shareholders' meeting.

After Vanke expressed its determination not to lie back down, it began to efficiently promote asset transactions, and new financing instruments such as REITs and CMBs continued to make breakthroughs.

Earlier, on May 13, Vanke A announced that the company applied for loans totaling 7.339 billion yuan from the Bank of China, Agricultural Bank, and Bank of Beijing. On May 20, Vanke received another 1.2 billion yuan loan from the Bank of China. On May 16, Vanke also successfully issued a CMBS (Commercial Real Estate Mortgage Backed Securities) worth 1,435 billion yuan on the Shenzhen Stock Exchange, further reducing overall financing costs.

Meanwhile, on May 17, there was market news that Vanke had reached a preliminary agreement with the bank on collateral for syndicated loans, and it is estimated that the loan withdrawal amount will not exceed 50 billion yuan.

Although the reporter sought evidence from Vanke, Vanke did not comment on this, but with the implementation of this syndicated loan led by CMB, analysts believe that it is expected that Vanke will continue to implement syndicated loans one after another.

It is worth noting that as Vanke's financing side continues to make breakthroughs, combined with the recent introduction of major property market support policies by various departments, Vanke is also showing a strong trend in the equity and bond market.

According to reports, Vanke A has been rising for many consecutive days recently, and up to now, its market value has returned to 100 billion dollars; Vanke's recent domestic bond prices have also generally risen; among them, Vanke's dollar bond due in 2027 once recorded the biggest increase since November last year.

Judging from performance performance, in April of this year, Vanke achieved a contract sales area of 1.643 million square meters, with sales of 20.89 billion yuan; in January-April of this year, Vanke achieved a total contract sales area of 5.554 million square meters, with a contract sales amount of 78.87 billion yuan.