Xinhua Finance and Economics, Beijing, July 2 (Wang Jing) Covering multi-level issuers, using the double credit enhancement model, and broadening the types of collateral assets...... Financial innovation tools help the development of private enterprises and welcome new measures. On July 2, the National Association of Institutional Investors announced the innovative launch of the Covered Bond (CB) financing tool for private enterprises, which will enhance the credit financing capacity of private enterprises through the design of asset guarantee structure and build a long-term support mechanism for private enterprise financing. On the same day, the first batch of 4 pilot projects of Kelun Pharmaceutical, Jointown, Yuyuan Co., Ltd., and Qi Carbon Technology have been registered and issued.
Industry insiders have said that the organic combination of main credit and asset guarantee, and give full play to the advantages of the "double credit enhancement" mechanism, can effectively reduce the financing threshold and cost of private enterprises, and reasonably increase the support for private enterprise financing. Regulators and self-regulatory organizations continue to practice the political and people's nature of financial work, and constantly enrich and improve the structured product system, which will strongly support the subsequent bond financing of private enterprises and help the high-quality development of the private economy.
Optimize the process and mechanism related to guarantee and debt repayment, and enhance the protection of bond investors
According to Xinhua Finance, the first batch of pilot projects have set up arrangements such as a dynamic adjustment mechanism for asset pools, a mechanism for issuers to replace or add assets, a regular monitoring mechanism for the duration of assets, and a mechanism for creditor agents to ensure that the effect of asset guarantee and disposal is implemented.
Zhang Xing, head of the fixed income group of CICC's investment banking department, told Xinhua Finance, "CB products fully draw on the experience and product advantages of mature international markets, combined with the actual characteristics of the mainland bond market, through the mortgage model and structured arrangements, etc., to better meet the practical needs of private enterprises to revitalize high-quality assets, improve bond credit level, and expand direct financing channels. ”
On the other hand, this financing tool encourages the introduction of bankruptcy isolation carriers such as trust plans in the product structure to achieve "bankruptcy isolation", and effectively protects investors' priority right to be repaid. At the same time, the tool introduces notarized creditor's rights documents and explores systems such as joint and several guarantees of actual controllers to help investors exercise their rights more quickly and effectively. It is reported that the financing tool is paired with a credit risk mitigation tool and uses the "asset guarantee + CRMW" double credit enhancement model to meet the diversified investment choices of investors with different risk preferences.
Wang Fei, President of the Investment Banking Department of Agricultural Bank of China, pointed out to Xinhua Finance that "asset-backed debt financing tools are of great significance to private enterprises, especially technology-based private enterprises with high-quality assets, to enrich financing channels and actively participate in capital market financing." CB has revitalized the assets of enterprises in related fields, and further enhanced investor protection based on the introduction of notarized creditor's rights documents. In addition, the combination of CRMW also provides a good risk mitigation for diversified investors to actively participate in subsequent issuances. ”
It can be said that the credit enhancement measures of "multiple guarantees" bonds are more diversified. Kuang Yanhua, general manager of the investment banking department of China CITIC Bank, told Xinhua Finance, "Asset-backed bonds are an important innovation in the domestic bond market, and through the introduction of the 'double credit enhancement' mechanism of assets and entities, we can achieve accurate matching of investment and financing needs in a wider range and further improve the quality and efficiency of the bond market to empower the real economy." In the long run, 'private enterprise asset-backed bonds' are expected to continue to play a positive role in enriching market players and stimulating market vitality. ”
From the perspective of the first batch of product lead underwriters, relevant institutions have "liked" the various structural advantages of CB. According to Zhang Kexiang, general manager of the investment banking department of the head office of Zheshang Bank, "Yuyuan shares grasp the policy window, make full use of the CB product 'subject + asset dual credit' support characteristics, revitalize its properties in Tianjin and achieve credit enhancement, increase the issuance quota, and reduce the comprehensive financing cost, which is another channel for the issuer to broaden the direct financing method." As the lead underwriter of the CB issuance, Zheshang Bank cooperated with the issuer to take stock of the property assets under its group, select high-quality properties that can protect the full recourse of investors as collateral assets, promote the registration and issuance process of CB products, realize the landing of the first batch of CB private enterprises in the country, and support and boost the bond financing of private enterprises in a market-oriented manner. ”
From an investor's point of view, the more investment opportunities brought by innovative products have also been recognized by the industry. Zhang Hongtao, vice president of Yunnan Trust, told Xinhua Finance that the asset-backed debt financing tool is flexibly used in private enterprises, providing investors with diversified investment channels, and Yunnan Trust will continue to give full play to its own institutional advantages and actively pay attention to the association's related innovative products. Liang Qing, general manager of the investment banking department of Shanghai Rural Commercial Bank, also pointed out that "for investors, the increase in investment varieties can better match the needs of diversified risk allocation, and more flexible transaction structures and more diversified product designs can reduce investment risks and better protect the rights and interests of investors." ”
In addition, many intermediaries have also given high expectations for product attributes and innovation positioning. Yu Ning, a lawyer at AllBright Law Offices, explained to Xinhua Finance that "in terms of legal relationship, CB is positioned as a 'structured financing tool with dual recourse for assets and subjects', which is a legal relationship between creditor's rights and debts, and is a kind of bond." CB has the characteristics of diversified sources of debt repayment and flexible transaction structure, and can better meet the needs of investors for risk allocation according to the corresponding credit trigger mechanism. In particular, CB has the characteristics of the security of the guarantee pool and the realizable value of asset disposal in case of default, and is equipped with mechanisms such as dynamic asset adjustment, qualification standards and regular tracking and evaluation of the asset pool during the duration of the asset, forming a good protection effect for investors. Under the premise of being based on the real transaction background and controllable risks, the issuer can also independently select movable assets and intangible assets with strong liquidity and a sound value and price system as collateral assets, so as to achieve safe, compliant and efficient financing purposes and form a win-win financing situation with investors. ”
The interbank market supports private enterprises to make further efforts to "expand capacity and increase categories" to accurately meet financing needs
Innovative financing tools have "many advantages", and private enterprises have received strong support from consulting, guarantee, issuance and other links. According to Xinhua Finance, the first batch of 4 products issued to "test the water" effect is good, specifically, Qi Carbon Technology made its debut in the bond market through the issuance of CB, broadening the relevant financing channels; Shanghai Yuyuan and other enterprises have reduced financing costs through the issuance of CB, attracting the participation of banks, brokers, funds and other investment institutions, and obtaining good feedback from the market; On the basis of CB products, Kelun Pharmaceutical, Qi Carbon Technology and other enterprises have issued special products such as scientific and technological innovation bills, which further meet the capital needs of scientific and technological innovation and other fields.
From the perspective of diversification of issuers, the industry of product issuers includes key areas of national economic development, such as scientific and technological innovation, pharmaceutical circulation, pharmaceutical manufacturing, and information software. The new asset category aims to revitalize the diversified assets of private enterprises, and expand to "soft assets" such as equity, accounts receivable, and intellectual property rights on the basis of "hard assets" such as real estate and land use rights, combined with the characteristics of private enterprises' production and operation. Qian Shunjiang, chief financial officer of Shanghai Yuyuan Tourism Mall (Group) Co., Ltd., told Xinhua Finance, "The company has many high-quality real estate resources across the country, and the CB products launched by the Dealers Association can efficiently revitalize the company's stock assets, provide credit enhancement for debt financing instruments with dual credit support of assets and entities, expand financing lines and save financing costs, and innovate financing methods for private enterprises holding high-quality assets." ”
From the perspective of reasonably relaxing the financing threshold, financing products support private enterprises to use a variety of assets to guarantee financing, and solve the problem of difficult and expensive financing under the credit financing path of traditional entities of private enterprises. "Support the independent selection of partial mortgage, full mortgage, over-collateral and other mortgage rate arrangements according to the different credit levels and asset characteristics of private enterprises." The person in charge explained.
Lai Degui, deputy general manager of Sichuan Kelun Pharmaceutical Co., Ltd., told Xinhua Finance, "CB provides an efficient, low-cost, and low-threshold financing channel for the company, and provides strong financing support for large enterprises like Kelun with high-quality assets and development potential." At the same time, compared with traditional credit bonds, CB has more diverse sources of debt repayment, a more flexible transaction structure, and can effectively revitalize corporate assets, making it a more standardized and liquid variety. Wang Qibing, vice president of Jointown Pharmaceutical Group, also pointed out, "The association innovatively launched the first batch of asset-backed debt financing tools for private enterprises in the whole market, which is a major measure to support the financing of private enterprises, and the issuance rate of '24 Jointown SCP001 (asset guarantee) has hit a new low coupon rate of various types of bonds of our company, which has effectively reduced financing costs." ”
In this regard, Hu Geng, chairman of Chengdu Qi Carbon Technology Co., Ltd., said, "This innovative pilot of the issuance of intellectual property asset-backed bonds is a full affirmation of the gold content of the intellectual property rights of Qi Carbon Technology, and it also broadens the financing channels of scientific and technological innovation non-listed enterprises." This will help the company continue to increase R&D investment, further enhance its technological innovation capabilities, promote the company's sustainable development in the gene sequencing industry, and consolidate its leading position in the field of nanopore gene sequencing. Through this innovative issuance pilot, we were able to attract the attention and trust of more investors. ”
In addition, from the perspective of issuance process support, the dealers association has set up a "pre-communication" pre-management mechanism, a special person docking service mechanism, and a "report and see" fast channel for private enterprises to issue CB, which greatly improves the financing efficiency. For a long time, the dealers association has continued to improve the financing service mechanism of private enterprises and promoted the postponement and expansion of the "second arrow". According to the data, as of the end of June 2024, debt financing instruments have served the issuance of 5.02 trillion yuan of private enterprises, and a total of 228.8 billion yuan was issued from January to June, a year-on-year increase of 16%, strongly supporting the bond financing of private enterprises.
In addition, the relevant person in charge also revealed to Xinhua Finance that at present, Tasly Group, Hongdou Group and many other private enterprises are also actively promoting the issuance of CB pilot projects.
Editor: Wang Zhe
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