Noting down Chinas financial reform(中国金融改革的探索与实践——杨凯生金融笔记)

　　《中国金融改革的探索与实践：杨凯生金融笔记（英文）》：　　The asset recovery ratio notched up by the Chinese AMCs was no less than those of global models like the RTC and KAMCO.Notably， the high asset and cash recovery ratios were achieved against comparatively low asset quality. When the RTC acquired USD465 billion assets from nearly 1，000 S&Ls， only one-third of the assets were classifted as NPLs， and 92 percent of the NPLs had collaterals. In contrast， among the purchased assets of China's four AMCs， a large part of the bad debts （including de facto ones） were eligible for write-offs， yet remained on the banks' balance sheets due to all kinds of reasons， and the proportion stood at almost 40 percent. A closer feview of the collaterals showed that over 70 percent of the four AMCs' purchased assets belonged to credit loans， whereas the validity of the collaterals and guarantees of the remaining less than 30 pefcent of secured loans were still questionable.　　Given those scenarios， it was extremely tough for the AMCs to achieve such high recovery ratios， which should assure us of the promising future of China's fmancial AMCs. We must also un-derline the low operating cost. In 2000， the total financial expense of the four AMCs was around RMB1.48 billion， only 0.1 percent of the total distressed assets under their management， while the annual percentage of the RTC's financial expense on average was over 1 percent， a 1：10 ratio in comparable costs. In other words，the Chinese AMCs realized a higher return with less expense and effectively controlled the cost for handling legacy issues.　　4. Promoting market-oriented resource allocation and econom-ic restructuring by mergers and acquisitions （M&As）， asset reor-ganization， bankruptcy liquidation， etc. We firmly believe that dis-In the past two years， the four AMCs undertook distressed asset disposal with strong self-motivation to serve the bigger picture of economic restructuring. With a portfolio of measures such as asset sale， auction， call for bids， asset and debt restructuring， asset re-placement， and M&As， they restructUfed thousands of enterprises'on-balance-sheet assets worth tens of billions of renminbi. It even led to the reorganization of enterprises in different industries and regions and under different ownerships.　　For example， asset restructuring in building material and textile industries opumized their industrial organizations； the transfer of distressed assets to private capital and multinational corporations diversified the ownership structure of SOEs； the 300-odd M&As channeled useful resources to enterprises with competitive edge and enabled SOEs to grow bigger and stronger； through debt re-covery and bankruptcy liquidation， nearly 1，000 companies with poor management， irreversible losses， resource wastage or heavy pollution were phased out. The reforms in corporate governance also led to agreements on IPOs assistance， underwriting and spon-sorship with dozens of enterprises. In addition， the four AMCs helped more than 20 listed companies with their reorganization，which revitalized the companies， helped the securities market stay stable and safeguarded investors' interests.tressed assets should be viewed as a kind of misallocated resource.　　……