Central bank to centralize corporate bill market

    CHINA plans to centralize the country’s commercial paper market, central bank vice governor Pan Gongsheng was quoted by Shanghai Securities News as saying yesterday.

    Commercial paper, sometimes known as corporate bills in China, refers to short-term obligations with maturities typically within 270 days issued by banks, corporations and other borrowers to investors with temporarily idle cash. “The central bank is pushing forward to build a unified national bill market, which is included in the central bank’s work plan,” Pan was quoted as saying. An electronic system will help cut commercial paper trading costs and risks, he added.

    Zibo Hongda Mining defaults on bond

    A CHINESE mining firm defaulted on its bonds, the latest firm to have trouble with financing as an economic slump hurts business.

    Zibo Hongda Mining Co., which is based in the eastern province of Shandong, said it didn’t raise enough funds to make its full debt payment due Tuesday, according to a statement posted to the Shanghai Clearing House website. The iron ore miner issued 400 million yuan (US$61 million) in notes in 2015 with a coupon rate of 8 percent and had to repay 431.91 million yuan in principal and interest Tuesday.

    Jianghuai seeks technology linkup with VW

    ANHUI Jianghuai Automobile Co., one of the few remaining major Chinese automakers without a foreign joint venture partner, is in talks to cooperate with Volkswagen Group as it seeks to gain more advanced technology.

    The company, which counts the Anhui Provincial Government as a shareholder, is actively pursuing joint venture tie-ups with foreign carmakers, according to chairman An Jin.

    Bad loan managers face risks, Huarong says

    CHINA’S bad loan managers are facing rising risks as the nation’s economic slowdown helps drive soured loans in the banking system to the highest in a decade, according to the head of China Huarong Asset Management Co.

    More capital at bad loan managers is being tied up for longer periods of time in soured debt as pricing conditions worsen amid the rising supply of such assets, Huarong chairman Lai Xiaomin wrote in a six-point proposal to the National People’s Congress. The firms need access to more and cheaper funding channels, said Lai, whose firm is China’s largest bad loan manager.