China’s first private bank begins lending

 

 

 

View - http://www.chint.com/news/7491?sitePageId=13http://cz.zjol.com.cn/system/

2015/03/27/020574125.shtml

 

 

 

 

WENZHOU, Zhejiang  |   2015-03-26 14:30:23

 

China’s first private bank

begins lending

 

 

By Fang Ning and Zhang Heping

 

 

The first private bank in China’s mainland opened for business in coastal Wenzhou City, east China’s Zhejiang Province on Thursday of March 26.

The Wenzhou Minshang Bank announced its ambition to target niche markets to offer inclusive financial services for small businesses, the self-employed, community residents, and county-level rural sector.

The bank completed its first credit service on Thursday, issuing a 300,000 yuan (48,289 U.S. dollars) loan to Jiangda Electronic Co. Ltd., a small electronics and aluminum foil producer.

Ma Ziguang, general manager of Jiangda Electric Co. Ltd.,told Xinhua his company, which focuses on export, often lacks capital.

“The bank’s easily-applied loan service is swift and handy,” he said adding the loan was given without any mortgage as the lender values the company’s production performance and reputation.

The bank’s main sponsors are electronic equipment producer Chint Group, industrial chemical maker Huafon Group as well 11 other large share holders, which include industrial firms, clothing manufacturers, real estate and high-tech firms. It was among the first three private banks approved by the China Banking Regulatory Commission (CBRC) in July last year.

According to the Wenzhou subsidiary of CBRC, the government has set up a very high “threshold” for approving the first private banks, taking in full consideration for share holders’ competitiveness, brand image and credit.

All the share holders are leaders in their respective fields and have corporate assets worth tens of billions of yuan.

Nan Cunhui, chairman of the bank’s biggest share holder Chint, acts as the bank’s chairman.

“Banks carry more social responsibility than other businesses. Facing competition from heavy-weight state-owned banks, Wenzhou Minshang Bank must provide differentiated financial services which should be more flexible, efficient and considerate,” he said.

Nan said the bank will mainly target small enterprises and community customers who need convenient and comprehensive financial services.

The bank’s governor, Hou Niandong, was a former deputy governor of the Zhejiang Provincial Branch of the Industrial and Commerce Bank of China, which is China’s largest commercial bank by assets.

Hou said there are 15,000 small businesses involved in the production chain of the bank’s 13 share holders.

“They are our first batch of potential customers to keep deposit accounts in the bank, which could shape up the bank’s ‘capital pool’ and capital flow,” he said.

CBRC’s approval of private banks, including two that are preparing to open – Shanghai Huarui Bank Co., Ltd. and the Shenzhen-based Webank, which was partly funded by Chinese Internet giant Tencent — is seen as China’s “ice-breaking” reform set up to dismantle the defacto monopoly by state-owned banks.

The city of Wenzhou is famous for its private entrepreneurship and manufactured exports. Bad loans, however, began to rise after the city’s private lending activities collapsed in 2011, forcing local businesses to go bankrupt and some entrepreneurs to commit suicide or flee. Companies here are in dire need of financial support.

This has become a driving force to push the government to think of ways to pilot financing reforms and channel money back to the real economy.

Miao Xinhao, deputy director of Wenzhou Financial Institute, said private banks set up with private funds are more viable in market competition and responsible for their own risks. The private sector will stimulate the state-owned banks to reform their system and services for survival.

 

 

 

 

 

 

 

Share


47 Comments

  1. Burton wrote:

    each time i used to read smaller articles or reviews that also
    clear their motive, and that is also happening with this post which
    I am reading at this time.

  2. We’re a group of volunteers and opening a new scheme in our community.
    Your website provided us with valuable information to work on.
    You’ve done a formidable job and our entire community will be thankful to you.

  3. Hi everyone, it’s my first go to see at this web page, and piece of writing
    is truly fruitful designed for me, keep up posting such content.

  4. Hey there this is kinda of off topic but I was wondering if blogs use WYSIWYG editors or if you have to manually code with HTML.
    I’m starting a blog soon but have no coding experience so I wanted to get advice from someone
    with experience. Any help would be enormously appreciated!

  5. Brook wrote:

    I know this if off topic but I’m looking into starting my own weblog and was wondering what all is needed
    to get setup? I’m assuming having a blog like yours would
    cost a pretty penny? I’m not very internet smart so I’m not 100% sure.

    Any recommendations or advice would be greatly appreciated.

    Cheers

  6. Joleen wrote:

    Outstanding quest there. What occurred after? Good luck!

  7. Ahaa, its good conversation concerning this piece of writing here
    at this webpage, I have read all that, so at this time me also commenting
    here.

Leave a Reply

*