Recently, the state-owned enterprise of the Chinese Communist Party, the China Central Depository & Clearing Co., Ltd., proposed a “clearance-style” transfer of 51% equity of China Trust Registration Corp. (referred to as China CSD) at a transfer base price of 1.56 billion yuan.
According to the official website of the Beijing Property Rights Exchange, on August 28, China Trust Registration Co., Ltd. listed 51% equity for transfer at a base price of 1.56 billion yuan. The transferor is the China Central Depository & Clearing Co., Ltd. The listing period is from August 28 to September 25.
Financial data disclosed by the Beijing Property Rights Exchange showed that in recent years, China CSD has been consistently operating at a loss.
In the fiscal year 2023, China CSD had operating income of 110 million yuan, a net loss of 253 million yuan, total assets of 2.765 billion yuan. In the first half of this year, operating income was 64.3219 million yuan, a net loss of 113.719 million yuan, total assets of 2.739 billion yuan, and total liabilities of 34.2184 million yuan.
According to 21st Century Business Herald, the China Central Depository & Clearing Co., Ltd. was the initiator and controlling shareholder of China CSD, holding 51% of the equity for nearly 8 years. After the successful transfer of equity, the China Central Depository & Clearing Co., Ltd. will no longer hold equity in China CSD, indicating a complete separation between the two entities.
A reporter from 21st Century Business Herald contacted China CSD as a potential transferee and was informed by staff that the listed equity involves institutional reforms and is a targeted transfer from the China Central Depository & Clearing Co., Ltd. to another shareholder of China CSD.
China CSD is positioned as a platform for trust products and their beneficial ownership registration and information statistics, trust product issuance and trading platforms, and trust industry regulatory information services in the trust industry in China, operated in a market-oriented manner.
Information on the official website indicates that China CSD was established with the approval of the State Council of the Communist Party of China, originally approved by the China Banking Regulatory Commission, and is now directly supervised and managed by the China Banking and Insurance Regulatory Commission as a non-bank financial institution providing basic trust services. It was declared established on December 26, 2016, with a registered capital of 3 billion yuan.
In terms of equity structure, the China Central Depository & Clearing Co., Ltd. holds 51% equity, the China Trust Guarantee Fund holds 2% equity, the China Trust Association holds 0.33% equity, and 18 trust companies such as China Aircraft Trust and China CITIC Trust each hold 3.33% equity.
The China Central Depository & Clearing Co., Ltd. is a central financial enterprise established in 1996 and is the only institution authorized by the Ministry of Finance of the Communist Party of China to establish and operate the national government bond custody system. It is also designated as a national bond registration, custody, and settlement institution in the national inter-bank bond market by the People’s Bank of China, serving as a primary custodian for counter-based national government bond trading.