Through the wealth life

Chapter 696 Bad Debt
When Qinghong presided over the opening of Starlight City in Treasure Island, Li Guangyu and Yuan Tianfan came to Xiangjiang Bank together to attend the bank's emergency meeting. At the same time, the major shareholders behind Xiangjiang Bank also attended.

Although Li Guangyu and the others tightened their loans to the real estate industry as early as the beginning of 82, and supervised the businesses that had already been loaned out, some bad debts still could not be avoided.

Small bad debts have little influence on banks, and some large bad debts are the headaches for banks.

This time, Xiangjiang Bank had a bad debt of [-] million Hong Kong dollars, and the news has not been spread yet, otherwise it would be a huge blow to the reputation of Xiangjiang Bank.

Although with the strength of the shareholders behind Hongkong Bank, [-] million Hong Kong dollars is not a big amount to them, but it has a considerable impact on customers.

In the conference room of Xiangjiang Bank, Feng Yubin, general manager of the banking business department, explained the situation of this business in detail to everyone present.

This business was loaned out in September 81. The loan period was three years. It was loaned to Xinfa Real Estate Real Estate Company. The controlling shareholder of this company is the Wang Guilin family.

Li Guangyu also knows something about this family. This is a medium-sized family in Xiangjiang, with family assets of about [-] million Hong Kong dollars. Its main business used to be the textile industry, but it has shifted to the real estate industry in recent years.

As the real estate market in Xiangjiang continues to rise, Xinfa Real Estate Real Estate Co., Ltd. has also continued to expand its scale, and its main business has also shifted to the real estate side. The real estate crisis has dealt them a heavy blow.

Moreover, their textile company did not transfer to an area with cheaper labor costs in advance, so their business there was not very good, and there was not much profit at all.

Now that there is such a big hole in the real estate company, the Wang family is unable to fill the hole. At present, they can only choose the real estate company to go bankrupt.

This has pitted Xiangjiang Bank. They borrowed in 81. Xinfa Real Estate Company paid interest every month, and the principal would not be returned until September next year. Now the company has chosen to go bankrupt, and the bank wants to recover the loan But it is difficult.

Li Guangyu and the others have nothing to do with this matter, and the Feng family cannot be blamed for this matter. The Wang family has been regular customers of Wing Hang Bank, the predecessor of Hong Kong Bank, for decades, and has cooperated with Wing Hang Bank for many years.Under the environment at that time, all procedures were reasonable and compliant, and the property market was still hot, so it was impossible not to give him a loan.

Li Guangyu said: "I believe this problem will not be an exception. Our major banks may also encounter it in the future. Especially at present, the real estate market is still going down, and many real estate companies will not be able to support it. Our current most important Let’s use this incident as a pilot to explore a method that can effectively reduce our bank’s losses, and serve as a reference for us to deal with similar incidents in the future.”

This is not only a problem faced by Heung Kong Bank, but also Bank of East Asia and Heung Kong Asia Commercial Bank. They also have many long-term cooperative customers. Whether some of these loans will become bad debts, no one is sure at present.

Especially the Bank of East Asia, they have been established for more than half a century, and some families have maintained cooperation with them for a very long time. It is very likely that there will be their customers in this wave of real estate bankruptcy. How to reduce losses in this crisis is the key It has become a problem that they urgently need to solve.

Zheng Yutong said: "The main problem at present is that these companies lack liquidity, and at the same time they are facing interest expenses on the bank side. In addition, their assets have also fallen with the decline in the property market, which makes them unable to make up for this hole. To solve this problem The problem, I think, is that one is that we take over the real estate developed by them, and the other is that the bank continues to provide them with blood transfusions so that they will not go bankrupt, so that we will not lose everything.”

Regarding Zheng Yutong's two suggestions, the second one was directly rejected. At this time, they don't need to continue to give these real estate companies blood transfusions to help them survive this round of crisis.

Since they chose to enter the real estate market hoping to make a fortune, they must have the consciousness of losing money, and finally hope that their bank will back them up, without even thinking about it.If every large client of their bank did this, their bank would be dragged down.

As for what Zheng Yutong said about them taking over the offer, this issue still needs to be discussed carefully. They are obviously unwilling to take over the offer at the current price.

Li Zhaoji said: "The more serious problem now is that Xinfa Real Estate Company only mortgages 80% of the shares in our bank, and the other 20% is in the hands of other people. Even if we want to deal with Xinfa Real Estate Real Estate Company, it is not easy to deal with it , this aspect also needs to be communicated with the bank.”

Li Guangyu is not worried about this. Even if the market value of Xinfa Real Estate Real Estate Company has plummeted due to the collapse of the property market, its own property is still worth about 5000 million Hong Kong dollars. As for its company, don't think about it. A few, the funds are even more dry, and they are worthless at all.

If the bank takes over the property of this company, the loan of [-] million Hong Kong dollars will be returned in two years.

Li Guangyu said: "The bank will talk to the Wang family first to see if they choose to transfer the company out or let our bank take it back directly. It would be better if they can repay the loan. If it doesn't work, we can only temporarily Take over the company, and see who owns the other 20% of the shares, and see what they think."

Li Guobao has much more experience in this area. Banks often have to take over their companies due to customers’ repayment of loans. However, banks usually try to transfer the companies out as soon as possible. They themselves will not operate these companies for a long time.

But Xiangjiang Bank is different. There are several real estate groups as shareholders behind them. If they take over Xinfa Real Estate Real Estate Company, the bank will not need to worry about the operation. These shareholders have enough manpower to solve business problems.

Now the consensus of the major shareholders is that it is impossible to continue the blood transfusion. If the Wang family is unable to repay the loan, they Xiangjiang Bank will take over the Xinfa Real Estate Real Estate Company, so that the bank will not suffer huge losses.

This year is the most difficult year for the Hong Kong real estate industry. After these two years, the Hong Kong real estate market will exert its strength again. The next crisis will not come again until the Asian financial crisis. The glory of the past ten years is enough for them to develop.

At the meeting, Li Guangyu and others discussed the current property market issues again. They will definitely enter the market this year, but they still need to communicate with Li Guangyu in terms of time, so they have time to prepare.

Li Guangyu said: "I expect to officially enter the market at the end of this year. At that time, the property market has almost reached a low point. It is a good time for us to enter the bottom-hunting at that time. Before this time, everyone can just continue to develop overseas markets." market, to consolidate development there.”

Since Li Guangyu said he would enter the market at the end of this year, they didn't ask any more questions. They happened to be exploring the Kuala Lumpur market during this year, which is also one of the key markets for their interest groups this year.

When Lee Kwong-yu visits Southeast Asia this year, Cheng Yu-tung will also visit some regions together. He is planning to open his jewelry stores and hotels in these regions.

(End of this chapter)