Central Huijin
From Taighde
| Central Huijin Investment Corporation Limited | |
|---|---|
| Type | State-owned |
| Founded | December 26th 2003 |
| Headquarters | Beijing, China |
| Key people | Peng Chun-General Manager |
| Total assets | $45 billion |
| Employees | 15 - 18 |
Central Huijin refers to the China Investment Corporation financial arm for Chinese financial institutions. Before September 2007, Central Huijin was a separate investment authority]. Due to the creation of the China Investment Corporation, Central Huijin was merged with the CIC. However, Central Huijin has a separate board of directors. Lou Jiwei, head of the CIC, is the chairman of the board.
Peng Chun is the general manager of Central Huijin. He replaced Xie Ping in April 2010.
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Creation
Central Huijin Investment Corporation was formed in 2003 to help bail out Chinese companies and to ensure government control of China’s largest banks by amassing majority stakes. Central Huijin have invested 5 trillion yuan ($641 billion) in 20 State-owned financial institutions including major commercial banks and a dozen brokerages. It holds stakes in the four largest banks in China. PBoC, seeing how successful Huijin has been, have pushed for an increased role for Huijin in managing investments. However, as a result of the creation of the China Investment Corporation, the corporation and its mission was taken over by the CIC. This occurred shortly before CIC's launch in September 2007. However, Central Huijin has a separate board of directors. Lou Jiwei, head of the CIC, is the chairman of the board.
Huijin was key in reforming the China banking sector.
- Huijin pushed to make the banks meet targets for return on assets.
- Huijin was instrumental in bringing foreign investors into the Chinese banks.
- Huijin, along with the PBoC, reduced the role of the communist party at the banks. Very few positions are now appointed by the party.
- Huijin was used by the PBoC as the vehicle for capital injections into the banks as part of their restructuring ahead of their overseas listings.
Recapitalization
In March 2010, according to press accounts, Central Huijin applied to receive up to a $50 million cash infusion from the Chinese government. Huijin has propped up several state-owned banks due to the global economic crisis. It is not clear if the capitalization is related to the CIC's request for an additional $200 million. Reports surfaced on April 21, 2010, that Central Hujin has been given the green light to issue $11.7 billion in bonds. [1]
Bond Sale
It was announced in the press that Central Huijin will sell $11.7 billion in bonds to raise money for a capital injection into Export-Import Bank of China (China Eximbank) and China Export & Credit Insurance Corporation. The bulk of the money would go into China Eximbank.
