BIZCHINA / Top Biz News |
ABC to start shareholding reform(Xinhua)Updated: 2007-01-21 09:53 China officially announced its decision to launch the shareholding reform on the Agricultural Bank of China (ABC) at the Third National Financial Work Conference closed on Saturday. ABC is the last of China's Big Four State-owned banks to start the reform which would lead to its market listing. Chinese Premier Wen Jiabao said that the shareholding reform of ABC will be pushed forward in a smooth and steady manner and the bank would continue to act as a major financial services provider for farmers and agriculture and in rural areas. He also said that China will advance the reform of other commercial banks and assets management corporations. ABC plans to be listed as a whole company, instead of being split into a group of provincial-level banks. "The shareholding reform of ABC is rather complicated and may take relatively long time to make full reform and market listing preparations," a senior official with the People's Bank of China told Xinhua. China initiated the reform of the Big Four banks after the first national financial work conference in 1997. The China Construction Bank took the lead in market listing in October 2005, followed by the Bank of China last year. The Industrial and Commercial Bank of China, the country's biggest lender, staged a dual debut in both Hong Kong and Shanghai bourses on October 27. All the three have followed the steps of government capital injections, dealing with non-performing loans, establishing shareholding companies, introducing strategic investors and seeking opportunities for listing. Of the Big Four, the Agricultural Bank of China has largest number of employees. By the end of 2005, the bank's total assets were valued at 4.77 trillion yuan. ABC is widely believed to be the worst hit by massive lending to the rural sector, with a non-performing loan ratio of 24.75 percent reported at the end of March, compared with the one to two percent level reported by established overseas banks. Up to US$70 billion would be needed to clear the bank's non-performing loans before it could meet overseas listing standards, analysts said. ABC said in its third quarter report that it had cleared away 7.82 billion yuan (US$99 million) of outstanding bad loans in the first nine months. The bank's bad loan ratio dropped by 2.68 percentage points to 23.49 percent by September and its operating profits rose by 34.85 percent to 42.57 billion yuan in the first nine months, the bank said. ABC established the accounting supervision and control center recently and started the personnel resources reform scheme to pave the way for the shareholding reform. ABC's shareholding reform plan would also take into consideration the requirements of building a socialist new countryside and rural financial institutional reform, it said. (For more biz stories, please visit Industry Updates)
|
|