Regulator gives green light to five local AMCs

Five provinces have been authorized by the banking regulator to set up local asset-management companies, according to a report by Anhui Daily, a newspaper of the Anhui provincial government, citing a statement from the China Banking Regulatory Commission.

The five AMCs in Jiangsu, Zhejiang, Anhui, Guangdong and Shanghai were approved to carry out bulk transfers of non-performing assets. Banks, trusts, finance companies, financial leasing companies and other financial institutions can sell their bad assets to these AMCs. Experts said the move will ease the pressure of an increasing bad loan rate.

In the past, China only had four national asset management companies, including China Cinda Asset Management Co, which were established in 1999 for the purpose of handling the bad loans of commercial banks.