Foreign players cite unfair competition in the sale of assets
Cinda Asset Management has delayed an international auction of non-performing loans worth 6.5 billion yuan, originally scheduled for today, by 12 days after foreign investors complained of unfair competition in the bidding.
The auction to sell the loans from the Bank of China in Tianjin would now be held on June 27, a Cinda official said yesterday, citing a need to survey market conditions.
Potential bidders were also told that the sale and purchase agreement for the loans, due to be distributed on June 7, had yet to be finalised.
However, bankers believe the real reason for the delay is a protest by foreign investors against the planned participation of two other state-owned asset management firms, Orient and Great Wall, which foreign buyers say would put them at a disadvantage.
'There were some foreign houses that made a fairly pointed request to the government that [it] consider the purpose of holding an auction and, if [it] holds an auction, why would [it] have the asset management companies bidding among themselves,' a foreign banker said.
Cinda officials, while conceding that matters are under review, have been unwilling to address the competition issue publicly, saying only that their procedures are open and above board.
