**Times reporter Chen Yukang.
Preventing and resolving financial risks is a compulsory course to promote the high-quality development of China's financial industry. In the capital market, the staking risk, which was once a concern, has been significantly reduced. **The Times reporter recently learned that since 2018, the pledge risk resolution of Shanghai companies has achieved good results. From the perspective of the market as a whole, the number of companies involved in the pledge has dropped from 1,380 to 880, and the phenomenon of "no shares and no pledge" has been basically eliminated. The overall amount to be repaid and the total market value of the pledge have decreased by about 40%, the scale of equity pledge financing has been significantly reduced, and the overall performance guarantee ratio of the market is nearly 206%, and the overall pledge default risk is controllable. As an important indicator to measure risk, the number of companies with a pledge ratio of more than 80% by controlling shareholders and their concerted actors has also dropped by more than 80% from the peak, accounting for 1 percent of all companies in Shanghai77%。
Behind the obvious results achieved in the resolution of pledge risks, it is inseparable from the collective efforts of all parties in the market. On the one hand, the regulator continues to improve the rules and regulations related to the pledge, urges shareholders and pledgees to operate in compliance, and actively builds bridges of communication and cooperation to guide the pledge parties to control the pledge ratio. On the other hand, Shanghai-listed companies and major shareholders have taken multiple measures to solve internal and external difficulties, and local governments, financial regulatory authorities, and market institutions have also taken active actions to resolve risks.
The system of pledge rules and regulations of the Shanghai Stock Exchange continues to improve
The equity pledge business of securities companies started in 2014, and after experiencing rapid development from 2015 to 2017, the risks of some pledge businesses began to be exposed in 2018. Since 2019, securities firms have been prudent in conducting business, and the stock scale of equity pledge business has gradually declined. However, the risk of pledge business that had problems in the early stage needs to be resolved urgently.
The risk of equity pledge is greatly affected by the fluctuation of equity value, and when the stock price is **, **pledge will face the risk of liquidation. The relevant person in charge of a Shanghai pharmaceutical company said in an interview with a reporter from the ** Times that improper disposal of equity pledge risks may affect the image of listed companies in the capital market and increase the risk of review by regulatory authorities. If the stock price leads to an increase in the pledge ratio, the pledgee has the right to the pledge, which may lead to the loss of control of the company by the major shareholder, which will directly affect the normal production and operation of the listed company.
In this context, under the guidance of the China Securities Regulatory Commission (CSRC), the Shanghai Stock Exchange has laid a solid policy foundation for promoting the cooperation of all parties and achieving effective relief by improving the rules and policies related to pledges.
Specifically, in January 2018, the Shanghai Stock Exchange issued the Measures for the Pledge Repurchase Transaction and Registration and Settlement Business, and in January 2019, the Shanghai Stock Exchange issued the Notice on Matters Related to Pledged Repurchase Transactions.
In April 2020, the Shanghai Stock Exchange issued the Notice on Matters Concerning the Default Disposal of ** Pledged Repurchase Transactions by Means of Agreement Transfer by Agreement (hereinafter referred to as the "New Deal on the Transfer of Default Disposal Agreements for ** Pledge Repurchase"). On the one hand, the threshold for the transfer of agreement is lowered, and the transfer ratio of a single transferee shall not be less than 2% of the total number of shares of the company;On the other hand, the minimum limit of the transfer of the coordination agreement shall not be less than 70% of the first trading day before the date of signing the transfer agreement.
Subsequently, in August 2021, the Shanghai Stock Exchange issued the Business Guidelines for Pledged Repo Transactions No. 1 - Risk Management. The industry believes that this move is intended to guide and standardize the compliance and prudent development of the company's pledged repurchase transaction business, and effectively prevent and resolve business risks.
All parties work together to promote the resolution of pledge risks
With the continuous improvement of the pledge rules and regulations system of the Shanghai Stock Exchange, the confidence of all stakeholders in resolving pledge risks has also been continuously enhanced.
Taking the new policy of transfer of the default disposal agreement of the pledge repurchase as an example, the industry generally believes that under this framework, resolving the risk of the pledge by agreement transfer is a bailout method that has the least impact on the listed company. As a result, a number of listed companies have ushered in a turning point in resolving the risk of equity pledge, and Zhongman Petroleum is one of the beneficiaries.
Shi Mingxin, secretary of the board of directors of Zhongman Petroleum, said in an interview with a reporter from the ** Times that the pledge of major shareholders of Zhongman Petroleum originated as early as 2018. At that time, the company's major shareholders and actual controllers insisted on deepening the development of the main oil and gas business, and in order to broaden the industrial chain of the listed company, they pledged part of the company to achieve financing, and invested the funds in the upstream and downstream entrepreneurial projects of the company's industrial chain, including Kazakhstan Tenge oil and gas field, Hubei natural gas project, Shanghai high-end petroleum equipment manufacturing project, etc.
However, under the influence of factors such as changes in the internal and external environment and the decline in oil prices, the company's performance has experienced a phased decline and even losses. With the continuous increase in the company's stock price, Zhongman Holdings and the actual controller had no choice but to continuously supplement the pledge held by them, resulting in a continuous increase in the pledge rate, which once approached 100%.
Among them, there are also deficiencies in the subjective understanding of the company and the shareholders themselves. At first, the controlling shareholder regarded the equity pledge as a simple financing tool, and did not fully consider how to solve the supporting financing of the follow-up project and how to return the follow-up project development funds. Shi Mingxin said.
Considering that if the controlling shareholder's equity is forcibly liquidated, it will affect the financing ability of the listed company, and then affect the daily production and operation, Zhongman Petroleum has efficiently promoted the bailout plan. The shareholders of the company obtain the funds through the transfer of agreement, and all of them are used to repay the pledged financing loans and resolve the pledge risk. In addition, at the operational level, the company has achieved a turnaround in performance by expanding its oil and gas business upstream.
The process of resolving the pledge risk is also inseparable from good communication with the pledgee. The original intention of the company's equity pledge financing is to support the high-quality development of listed companies and deepen the main industry, so it has obtained the understanding of the pledgee. Shi Mingxin said that through this model, the company was able to reduce the scale of financing defaults on equity pledges by more than half in a short period of time. Since then, with the steady development of Zhongman Petroleum and the recovery of its stock price, the company has also successfully reduced the scale of pledge financing to a reasonable range through agreement transfer. At present, the pledge rate of the company's major shareholders has been generally controlled below 70%, and it will be further reduced in the future.
Another Shanghai-listed company reduced the scale of debt and reduced the pledge ratio by actively raising funds to repay the principal and interest of the loan in advance by the actual controller. The person in charge of the company told the ** Times reporter that in 2019, the share pledge ratio of the company's controlling shareholders and persons acting in concert was as high as 9910%。After the above operations, from February 2021 to the present, the company's controlling shareholders and persons acting in concert have not had a high proportion of pledges. With the release of the high proportion of pledge risks, the company's operating conditions have gradually improved. As of the third quarter of 2023, the company's net profit was 3100 million yuan, an increase of 16 percent over last year17%。
Major shareholders and actual controllers should pay attention to risk control, and formulate effective mechanisms for identifying and assessing risks and corresponding solutions. In addition, to ensure the timely, accurate and complete information disclosure of listed companies, and to protect the right to know and participate of all shareholders. The relevant person in charge of a Shanghai pharmaceutical company said, "Major shareholders have the responsibility to support the development of listed companies and provide resource support including capital and business for listed companies to continue to improve their operating performance." ”