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China Huarong Asset Management Co Ltd finally published results for the full year ended December 30, 2020 and the interim results for the six months ended June 30 on Sunday. The distressed asset manager reported a loss of RMB 102.9bn ($15.9bn) for 2020, in line with guidance given a few weeks ago. The loss was on the back of massive impairments of RMB 107.8bn ($16.67bn) and loss on financial assets of RMB 12.5bn ($1.93bn). The loss led to its shareholder equity being slashed by ~85%, as per Bloomberg. Huarong’s leverage ratio (interest bearing debt to equity) spiked to a massive 1,333x and its capital adequacy ratio (capital to risk-weighted assets) fell to 4.16% as at end 2020. In the first six months of this year, Huarong made some progress in improving its financial position with a 1H profit of RMB 1.624bn ($251mn). Its leverage ratio and capital adequacy stood at 37.1x and 6.32% as of June 30. As per Bloomberg, Chinese regulators require distressed asset managers to have a minimum capital adequacy of 12.5% and a minimum core tier-1 ratio of 9%. Chairman Wang Zhanfeng called 2020 “a harsh lesson to be learned in the development history of the company,” adding, “What is gone is gone, but go for what to come. We will learn from the lesson and take it as valuable experience and the desire to move forward.” The company said that it plans to offload non-core subsidiaries in the near future to increase cash flows and boost its capital position, but further details were lacking.