ABC bank plans to securitize $459m of NPLs

Agricultural Bank of China Ltd, the country's third-biggest commercial lender by assets, will issue 3.06 billion yuan ($459 million) of securities backed by nonperforming loans in the interbank bond market on Friday.

The senior tranche of the securities with a three-year maturity is worth 2.06 billion yuan, accounting for 67.3 percent of the total. The equity tranche with a five-year maturity is worth 1 billion yuan, according to documents posted on the website of China Central Depository & Clearing Co Ltd.

The securities are backed by 1,199 loans to 204 borrowers spread in industries from the wholesale and real estate to the textile sector. The bank said that by March 21, the balance of unpaid principal plus unpaid interests had totaled 10.73 billion yuan. The amount of NPLs that can be recovered is expected to be 4.37 billion yuan.