ICBC Granted Over RMB 180 Billion Loan to Minor Enterprises

In 2005, ICBC developed the credit market of minor enterprises vigorously, enforced and bettered the financial services for minor enterprises of high quality. According to the internal statistics, the loan to minor enterprises of 2005 sums up to RMB 185.8 billion, including RMB 78 billion of discounted notes.

Till the end of December 2005, ICBC had possessed loan balance of RMB 113.5 billion to minor enterprises, which is RMB 46.8 billion higher than that at the beginning of 2005. With the rapid increase of loans to minor enterprises, ICBC enforced inner control and risk management at the same time. The defective fraction of loans to minor enterprises is 1.

32%(excludes discounted note), which was kept at a preferable level.

A related person-in-charge from ICBC introduced that, for long ICBC has been focusing on the development of credit business to minor enterprises. In 1998, ICBC set up a department specially provide services for minor enterprises, and constituted series of policies to support their development, such as Guiding Notes on Credit Work of Minor Enterprises.

After 2003, ICBC found through investigations that according to the current standard for national classification of enterprises, the number of minor enterprises takes up over 99% of the number of enterprises in China, according to the internal statistics. Due to the over wide object range, the policies of banks supporting minor enterprises cannot be realized for those in most need of.

To make the supporting objects concrete and specified, ICBC takes a lead in national finance system by proposing "minor enterprises" as separated managing objectives from large enterprises, which is recognized by the PBC and CBRC.

In recent years, ICBC has constituted a series of credit policies and regulations for minor enterprises and promoted them through experimental units in ICBC, which has provided powerful support for the development of minor enterprises and been highly praised by State Council and inspective departments. ICBC hence becomes the only state-owned commercial bank that is identified by CBRC as the credit business contact bank for minor enterprises.

In 2005, ICBC brought out another ten measures for supporting development of minor enterprises, which are: reinforce the grading regional credit policy for minor enterprise; perfect customer credit policies suitable for the features of different financing needs of minor enterprises; broaden warranty channels; positively extend credit products that meet financing needs of minor enterprises; perfect pricing system of loan to minor enterprises; carry out time-limitation management of loans to minor enterprises based on the analysis of their operation and cash cycling situation; reform the post-loan management modes for minor enterprises; establish separated sales teams for financial products to minor enterprises; set up separated loan evaluation system for minor enterprises, build up cycle system for risk managing and compensation; perfect the linkage system between loans to minor enterprises and other financial products.

In addition, ICBC has taken the lead while separating the credit evaluation of minor enterprises from that of the legal entity of the corporation. According to their internal statistics and features of their operation management, ICBC established a set of credit grading system suitable for the risk features of minor enterprises, realized electrical management of the whole process and ensured the healthy development of credit business of minor enterprises.