Young Economists Roundtable on Money and Finance (No.4): Special Situation Investment and Non-Performing Assets Management

On April 20, the Yong Economists Roundtable on Money and Finance (NO.4) themed on “Special Situation Investment and Non-Performing Assets Management” was held in Renmin University of China. The closed-door seminar was hosted by International Monetary Institute(IMI) and co-hosted by Beijing Hongshan Taiye Investment Management Co., Ltd. and Beijing Headsail Technology Co.,Ltd. Luo Ning, Research Fellow and Senior Economist of Pangoal Institution, Shi Xinjie, General Manager of Rocken international Investment management C.,Ltd., Xiong Yuan, IMI Research Fellow and Chief Macro-Economy Analyst with Guosheng Securities, Zhang Yu, IMI Research Fellow and Chief Macro-Economy Analyst with Hua Chuang Securities, delivered keynote speeches. The seminar was chaired by Jiang Bo, IMI Research Fellow and General Manager of Finance Department of the Tahoe Group. Luo Ning delivered a speech themed on “Macro Risk Cycle and Financial Security”. He believed that the operation of non-performing assets and transactions would not be possible without a stable financial environment. Finance was the core competitiveness of one country, and thus preventing systemic financial risks was the most fundamental task. In terms of the development prospects, Luo Ning pointed out that without a discourse system, China’s financial sectors might be at a disadvantage when a new global governance system was formed in the future. Shi Xinjie shared his opinions under the theme of “Practical Management of Irregular Bonds”. As for the deleveraging issue, he mentioned five leverages: state, local governments, state-owned enterprises, individuals and private enterprises; as for the irregular conduct of bonds, he thought it was related to four aspects: enterprises, law firms, governments and investors. In the end, he pointed out that China’s junk bond market, including Hong Kong’s dollar bond market, was a blue ocean market with a promising future.

Luo Ning

Xiong Yuan made a speech on the topic of “Supply-Side Reform in Financial Sector and Equity Investment”. He suggested that China may usher in a big era of equity in the future. It was hard for China to replace the old driving force with a new one by traditional real estate industry. The Optimum allocation of residents' wealth required the full engagement of the capital market. In terms of supply-side reform in financial sectors, Xiong Yuan believed that this was mainly a process of addition, and we had to increase our financial supply, including financial infrastructure, financial products, and financial services.

Xiong Yuan

Zhang Yu shared her views under the theme of "Assess the Cycle of Non-Performing Assets from the Perspective of Asset Allocation." She said that the key to reform lied in the structure and the reform of state-owned enterprises was the core of structural reform. In terms of state-owned enterprises reform, financial neutrality was the crucial part, which was the root cause of all the existing problems. When mentioning debt limit, she believed that state-owned enterprise’s debt scale was connected with the enterprise’s size. The bigger the size, the better the credit loan resources. However, as for private enterprise’s debt limit, it was related to the enterprise’s business capacity.

Zhang Yu

Jiang Bo delivered a speech on "The Love Sparks between Financial Technology and Non-Performing Assets". He pointed out that with the popularization of inclusive finance and consumer finance in recent years, people became more active in disposing their non-performing assets. The techniques applied to disposing non-performing assets of consumption were mainly concentrated in the processing of collection data, the wholesale and automation of collection business, the collection of big data and precise pricing. He also mentioned that the size of non-performing assets would expand in these two years, so more technology-enabled intermediaries would engage in the ecology of the financial industry.

Jiang Bo

In addition, Qu Qiang, IMI Assistant Director and Research Fellow, Tian Xinming, IMI Research Fellow and Manager of Fixed Income Department of Rongtong Fund, Zhang Tun, fellow of Postdoctoral Centre at China Cinda Management Co,.Ltd., Jing Linde, IMI Research Fellow and ICBC Asset Management Department officer also attended the meeting and participated in the round table discussion.

DOWNLOAD