China CITIC Financial Asset Management (previously known as China Huarong) is a majority

state-owned State ownership, also called public ownership or government ownership, is the ownership of an industry, asset, property, or enterprise by the national government of a country or state, or a public body representing a community, as opposed to ...

financial

asset management Asset management is a systematic approach to the governance and realization of all value for which a group or entity is responsible. It may apply both to tangible assets (physical objects such as complex process or manufacturing plants, infrastr ...

company in

China China, officially the People's Republic of China (PRC), is a country in East Asia. With population of China, a population exceeding 1.4 billion, it is the list of countries by population (United Nations), second-most populous country after ...

, with a focus on distressed debt management. It was one of the four asset management companies that the

Government of China The government of the People's Republic of China is based on a system of people's congress within the parameters of a unitary communist state, in which the ruling Chinese Communist Party (CCP) enacts its policies through people's congresses. ...

established in 1999 in response to the

1997 Asian financial crisis The 1997 Asian financial crisis gripped much of East Asia, East and Southeast Asia during the late 1990s. The crisis began in Thailand in July 1997 before spreading to several other countries with a ripple effect, raising fears of a worldwide eco ...

History

On 11 November 1999, China Huarong was incorporated in

Beijing Beijing, Chinese postal romanization, previously romanized as Peking, is the capital city of China. With more than 22 million residents, it is the world's List of national capitals by population, most populous national capital city as well as ...

as China Huarong Asset Management Corporation (), which was one of the four asset management companies as approved by the

State Council of the People's Republic of China The State Council of the People's Republic of China, also known as the Central People's Government, is the chief administrative authority and national cabinet. It is constitutionally the highest administrative organ of the country and the e ...

. In 2000, China Huarong began acquiring a

non-performing loan A non-performing loan (NPL) is a bank loan that is subject to late repayment or is unlikely to be repaid by the borrower in full. Non-performing loans represent a major challenge for the banking sector, as they reduce profitability. They are ofte ...

of RMB 407,696 million from the

Industrial and Commercial Bank of China The Industrial and Commercial Bank of China (ICBC; zh, 中国工商银行) is a Chinese partially state-owned multinational banking and financial services corporation headquartered in Beijing, China. It is the largest of the " big four" banks ...

. The company later became a limited company: China Huarong Asset Management Co., Ltd. () in 2012. In August 2014, China Huarong introduced seven strategic investors, including

Warburg Pincus Warburg Pincus LLC is a global private equity firm, headquartered in New York City, with offices in the United States, Europe, Brazil, China, Southeast Asia and India. Warburg has been a private equity investor since 1966. As of April 2024 the f ...

, CITIC Securities International,

Khazanah Nasional Khazanah Nasional Berhad (; Trade name, traded as Khazanah Nasional or simply Khazanah) is the sovereign wealth fund of the Government of Malaysia. One of the largest sovereign wealth funds in the world, it was established to invest surplus ...

, China International Capital Corporation, COFCO Group,

Fosun International Fosun International Limited is a Chinese multinational conglomerate holding company. Founded in 1992 by Guo Guangchang and four others, the company is headquartered in Shanghai and was incorporated in Hong Kong in 2004. Its Co-CEOs are Chen ...

, and

Goldman Sachs The Goldman Sachs Group, Inc. ( ) is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered in Lower Manhattan in New York City, with regional headquarters in many internationa ...

while the

Ministry of Finance of the People's Republic of China The Ministry of Finance of the People's Republic of China is the Constituent departments of the State Council, constituent department of the State Council of the People's Republic of China which administers macroeconomic policies and the annu ...

remained the majority controlling shareholder and China Life Insurance Group increased its shareholding. In October 2015, China Huarong raised HK$17.8 billion through an initial public offering (IPO), offering 5.77 billion new shares in Hong Kong.

Trial and execution of Lai Xiaomin

In April 2018, the Central Commission for Discipline Inspection, and the National Supervisory Commission launched an investigation into possible "serious violations of discipline and laws" of Lai Xiaomin, the Chairman of China Huarong Asset Management, and the

Chinese Communist Party Committee Secretary A Party Committee Secretary () is the leader of the Chinese Communist Party (CCP) organization in a province, city, village, or other administrative unit. In most cases, it is the ''de facto'' highest political office of its area of jurisdictio ...

for Huarong. As Huarong's Party Secretary, he emphasized in 2015 that during the operation of China Huarong Asset Management, the

Chinese Communist Party The Communist Party of China (CPC), also translated into English as Chinese Communist Party (CCP), is the founding and One-party state, sole ruling party of the People's Republic of China (PRC). Founded in 1921, the CCP emerged victorious in the ...

(CCP) committee inside the company should play a central role, and party members should play an exemplary role. On 15 October 2018, Lai Xiaomin was expelled from the CCP. On 11 August 2020, the No. 2 Intermediate People's Court of Tianjin opened a public hearing on the case of bribery, corruption, and bigamy of Lai Xiaomin. The indictment alleges that Lai Xiaomin accepted 1.788 billion yuan in bribes, and illegally occupied public funds 25.13 million Yuan. On 5 January 2021, Lai was found guilty of receiving 1.79 billion yuan ($277.3 million) in bribes and bigamy and was sentenced to death without reprieve for

bribery Bribery is the corrupt solicitation, payment, or Offer and acceptance, acceptance of a private favor (a bribe) in exchange for official action. The purpose of a bribe is to influence the actions of the recipient, a person in charge of an official ...

embezzlement Embezzlement (from Anglo-Norman, from Old French ''besillier'' ("to torment, etc."), of unknown origin) is a type of financial crime, usually involving theft of money from a business or employer. It often involves a trusted individual taking ...

, and

bigamy In a culture where only monogamous relationships are legally recognized, bigamy is the act of entering into a marriage with one person while still legally married to another. A legal or de facto separation of the couple does not alter their mar ...

. His private assets were seized as well. The sentence was carried out on 29 January 2021.

2021 Bond selloff and default fears

In April 2021, offshore U.S. dollar bonds issued by China Huarong plunged in value. The selloff came after the company missed an end-March deadline to release its 2020 financial results. Fears of a near-term default were eased after the company was said to have prepared funds for full repayment of S$600 million ($450 million) offshore bonds due 27 April. To reduce the risk of market contagion and to stabilize its cash flow, Chinese regulators asked Chinese banks to provide loans to China Huarong. In August 2021,

CITIC Group CITIC Group Corporation Ltd., formerly the China International Trust Investment Corporation (CITIC), is a state-owned investment company of the People's Republic of China, established by Rong Yiren in 1979 with the approval of Deng Xiaoping. ...

became China Huarong's largest shareholder with a nearly 26.5 percent stake after a group of state-owned investors bought into the company.

2022 to present

In January 2024, the company was renamed to China CITIC Financial Asset Management.

Subsidiaries

* Huarong International Financial ()

Equity investments

Baiyin Nonferrous Baiyin Nonferrous Group Co., Ltd. ( zh, 白银有色集团股份有限公司), also known as BNMC, is a major Chinese state-owned enterprise involved in the mining, smelting, and processing of nonferrous metals, including copper, lead, zinc, silv ...

(0.30%) * Fenxi Mining Industry Group *

Taiyuan Coal Gasification Group Taiyuan Coal Gasification (Group) Co., Ltd. is a Chinese state-owned coal mining conglomerate based in Taiyuan, Shanxi. The company was owned by State-owned Assets Supervision and Administration Commission (SASAC) of . However, Shanxi SASAC g ...

(2.46%) * Xinjiang Ba Yi Iron and Steel Group (7.95%) * Fullshare Holdings (9.88% indirectly) * Uxin (5.48%) Former * Wanhua Industrial Group (15.04%)

References

External links

* {{CITIC CITIC Group Companies listed on the Hong Kong Stock Exchange Investment management companies of China Financial services companies of China Government-owned companies of China H shares 2023 mergers and acquisitions 2015 initial public offerings Asset management companies