Huarong turned into joint-stock company

China Huarong Asset Management Co Ltd, one of four asset management companies set up to clear the bad debts of State-owned banks, was officially unveiled as a joint-stock company on Friday.

The move, insiders said, paved the way for the company to attract strategic investors and go public via an IPO.

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"We hope potential strategic investors could help strengthen Huarong's business, management, branding and its globalization," said Lai Xiaomin, chairman of Huarong Asset Management Co Ltd.

"The company will focus on commercial banking, trusts, leasing and other banking businesses while continuing to do a good job in asset management," Lai added.

With registered capital of 25.8 billion yuan ($4.07 billion), 98.06 percent of the new company's shares are held by the Ministry of Finance, with the remaining 1.94 percent held by China Life Insurance Company.

At the end of June, the total assets of Huarong stood at 246.3 billion yuan.

The company made a profit of 5 billion yuan last year, up 148 percent on 2010.

Between 2009 and 2011, it maintained annual profit growth of more than 100 percent, and in the first half of 2012, its profits surged 60 percent year-on-year despite the slowing economy.

Huarong has accepted, acquired and disposed of toxic assets worth more than 720 billion yuan to date, according to the company.

It has 32 branches across the country and 10 subsidiaries, covering a wide range of businesses including securities, trusts, futures and financial leasing.

In 1999, China set up four asset management companies, Cinda, Great Wall, Orient and Huarong, designed to manage the toxic assets of the country's four biggest State-owned banks as they worked to transform themselves into more market-oriented lenders.

Huarong is the second asset management company transformed into a joint-stock company, following China Cinda's restructuring in June 2010.

Cinda received $1.6 billion in March from four strategic investors in preparation for a listing.

huyuanyuan@chinadaily.com.cn