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source: city finance network

on september 3, according to information from the beijing equity exchange,12.9765 million shares of hankou bank were publicly listed for transfer with a reserve price of 45.6707 million yuan. the transferor was hubei communications services co., ltd. (hereinafter referred to as hubei communications).in recent years,at least four state-owned shareholders plan to sell off their shares in the bank.

it is observed that hankou bank's performance has continued to grow in recent years, but it is still stuck in the guidance stage after years of preparation for ipo. according to its 58th guidance work report in july,the bank currently still faces the problem of "capital adequacy indicators facing certain pressure".

in addition to the core adequacy ratio, hankou bank also faces issues of internal control and compliance.in the past year, the bank and its branches received a total of five fines, each of which was worth millions.this may be related to the bank's frequent senior personnel changes.

01

state-owned shareholders are accelerating their exit

public information shows that hubei communications is a state-owned enterprise, which is 100% owned by china mobile communications group co., ltd.the 12.9765 million shares of hankou bank held by hubei communications are original shares. currently, hubei communications holds a total of 0.27% equity of hankou bank. this listing transfer is intended to clear all the shares held in the bank and thus withdraw from the ranks of shareholders of the bank.the listing period is from september 3rd to september 30th.

for this transfer,industryit is generally believed thatthis is also a continuation of the recent divestiture of non-core financial assets by state-owned shareholders of central enterprises.

su xiaorui, senior researcher at suxi zhiyansaid that in recent years,some shareholders consider the cost-effectiveness of investment or weigh the importance of focusing on the main business based on the "refund order" and other factors., and actively chose to transfer the equity of small and medium-sized banks in the open market. however, due to the small transfer ratio, the impact on the banks was limited.

it is understood that the 12.9765 million shares held by hubei communications are the original shares of hankou bank.in early january this year, it tried to clear out the equity through comprehensive investment promotion. at that time, the price of the equity was "negotiable" and the listing date was from january 2, 2024 to january 2, 2025.however, until today, eight months later, the equity has not been successfully sold.

this is not the first time that a state-owned shareholder has attempted to transfer its stake in hankou bank.

according to incomplete statistics,currently, at least four shareholders with state-owned backgrounds are listing the bank’s shares, and all of them are “clearance-style” transfers.however, judging from the disclosure date, the transfer information of the other three shareholders who are still listing the relevant equity will expire in the near future.

specifically, in december last year, china aerospace science and technology corporationchina yangtze power group co., ltd.it plans to transfer 30 million shares of hankou bank for rmb 175.8 million, accounting for 0.62% of the bank's total share capital;

china construction groupchina construction third engineering bureau co., ltd.it plans to transfer 24.6492 million shares of the bank at a reserve price of 125.4115 million yuan, accounting for 0.5106% of the equity;

china general technology (group)china technology international engineering co., ltd.it plans to transfer 213,100 shares of the bank at a price of 858,600 yuan, accounting for 0.0044%.

industry insiders said that the central soes cleared their equity in financial enterprises mainly to focus more on their main responsibilities and businesses and strengthen the competitiveness of their core businesses.the regulatory authorities have also been guiding state-owned central enterprises to strictly control non-core business investments and divest financial assets, in an effort to curb the blind diversification and "spreading out" tendencies of some state-owned enterprises.

02

capital replenishment faces pressure

it has been observed that hankou bank's performance has continued to grow in recent years.

from the perspective of business performance, hankou bank has continued to expand its business scale and achieve continuous growth in recent years.operating revenue: rmb 6.814 billion, rmb 8.444 billion, and rmb 8.567 billion, attributable to the company's common shareholdersthe net profits were rmb 991 million, rmb 1.262 billion and rmb 1.412 billion respectively.

however, after years of preparation for ipo, it is still stuck in the coaching stage. according to its 58th coaching work report in july, hankou bank is still facing the problem of "capital adequacy index facing certain pressure".

existchina chengxin internationalit seems that the bank's net profit continues to grow, but its profitability is still weaker than that of its leading peers, and its asset quality is facing downward pressure.this places higher demands on liquidity management and requires further expansion of capital replenishment channels.as of the end of 2023, hankou bank's non-performing loan ratio was 2.61% and its provision coverage ratio was 162.63%.

april 23,china chengxin internationalthe rating report on hankou bank pointed out that it was concerned about the many challenges faced by hankou bank, including the need to further reduce the concentration of loan customers,asset quality and provisioning face certain pressures, and profitability still has room for improvement, deposit stability needs to be strengthened, there is a certain maturity mismatch between assets and liabilities, and capital replenishment faces certain pressure, etc.

data shows that by the end of june 2024, hankou bankcapital adequacy ratio is 13.29%, tier 1 capital adequacy ratio was 9.75%, and core tier 1 capital adequacy ratio was 8.07%. although both met regulatory targets, the bank's capital adequacy level was still below average compared to its peers.

the latest data from the state administration of financial supervision and administration shows that by the end of the fourth quarter of 2023,the capital adequacy ratio of commercial banks (excluding branches of foreign banks) was 15.06%the tier 1 capital adequacy ratio was 12.12% and the core tier 1 capital adequacy ratio was 10.54%.

03

short-term high-level changes

in addition to the core adequacy ratio, hankou bank also faces internal control compliance issues. in the past year, hankou bank and its branches have received a total of five fines, each of which was as high as one million yuan.

on july 26, the hubei regulatory bureau of the state financial regulatory administration disclosed a fine related to hankou bank. the fine showed that hankou bank qiaokou branch was fined 1.4 million yuan for "illegally handling bank acceptance bill business." in addition, a customer manager at the branch was also fined 50,000 yuan and warned.

on april 19, the administrative penalty decision document disclosed by the hubei regulatory bureau of the state financial supervision and administration showed that hankou bank was fined 4.85 million yuan for 14 violations of laws and regulations. the main violations included: inadequate credit management, lending by pledging loans to deposits; illegal approval and issuance of working capital loans for non-compliant purposes; and illegal lending to real estate companies.

the frequent fines received by hankou bank in the past year may be related to the frequent senior personnel changes in the bank.

the 2023 annual report shows that the bank had a total of 10 senior management changes between march 2023 and february 2024, of which six were the resignations of directors, supervisors and senior executives, including three resigned vice presidents. frequent changes in senior management may lead to omissions in internal control management.

the relatively concentrated high-level changes in a short period of time are related to the fact that many of the bank's senior executives had previously served beyond their term of office.

according to relevant statistics, chen xinmin, the chairman who left in may last year, took the helm of hankou bank in 2009 and served for 14 years. on december 29 last year, chen xinmin was expelled from the party and removed from office. during his tenure, he made illegal loans, embezzled public funds, and used his position to profit for others. he relied on finance to make a living from finance, and did a lot of illegal things, which had a bad impact. ruan xuzhou, the executive director and vice president who left in march last year, served as vice president of hankou bank since 2008, and served for more than 14 years. sun zhengbai, the vice president who left in september last year, started to work in 2011 and served for about 12 years.

despite a major reshuffle of a group of directors, supervisors and senior managers, the phenomenon of hankou bank's senior management serving beyond their term has not yet been eradicated.

the 2023 annual report shows that ding rui, the bank's board secretary since 2008, is still the bank's board secretary and concurrently the chief financial officer as of the time of the annual report. similarly, lei fengxin, the vice president who took office in 2008, is still the chairman and attended the 13th china emerging financial institutions cooperation and exchange annual conference in this capacity this month. these senior leaders have worked with chen xinmin for many years and still hold important positions in hankou bank.

it is understood that hankou bank was established in december 1997. its predecessor was wuhan urban cooperative bank, which was formed by 62 urban credit cooperatives and one urban credit cooperative union in wuhan. it was officially renamed hankou bank in 2008. as early as december 2010, the bank had launched its listing plan. however, after 14 years of preparation for listing, it is still in the ipo guidance period, and its guidance work has been carried out for 58 sessions.

haitong securities, the tutoring institution, said that since 2023, hankou bank's business has continued to develop, capital has continued to be consumed, and capital adequacy indicators have faced certain pressure. in order to further improve the capital adequacy ratio, haitong securities will continue to urge hankou bank to adopt various methods to supplement capital in accordance with the relevant regulations of the regulatory authorities, and enhance hankou bank's ability to serve the real economy and resist risks.