China Development Bank
From Wikipedia, the free encyclopedia
The China Development Bank (CDB) (Simplified Chinese: 国家开发银行; Traditional Chinese: 國家開發銀行; pinyin: Guójiā Kāifā Yínháng) is a financial institution in the People's Republic of China (PRC) under the direct jurisdiction of the State Council. It is the only bank in China whose governor is a full minister. It is one of the three policy banks of the PRC, primarily responsible for raising funding for large infrastructure projects, including most of the funding for the Three Gorges Dam and Shanghai Pudong International Airport. The bank was established by the Policy Banks Law of 1994.
Debts issued by CDB are fully guaranteed by the central government of the People's Republic of China. CDB is one of the biggest issuers of bonds in the PRC.
The bank had RMB 1.5 trillion in loans outstanding as of the end of 2004. During 2004, the bank made a profit of about US $2 billion. The bank is the most profitable bank in China, and the second most profitable bank in Asia.
In year 2005 and 2006 China Development Bank successfully issued two pilot ABS products in domestic China market. Together with another ABS products issued by China Construction Bank, they have set the corner stone for a promising debt capital & structured finance market.
After governor Chen Yuan, who was the executive deputy governor of The People's Bank of China (China's Central Bank), took over the bank in 1998, CDB has experienced tremendous growth in profit and reduction in bad loan rate. Currently, it is the most healthy bank in China with a bad loan rate of about 1% at the end of 2004. This is an extraordinary achievement for a Chinese bank considering that the four major state owned commercial banks all have high double digit bad loan rates.
CDB has about 3500 employees at the end of 2004, about 1000 of them work at the Beijing Headquarters and the rest are spread out in 32 branches throughout the country. The bank does not take private savings, and hence does not have thousands of local branches like other major banks in China do. According to Michelle Chan-Fishel, program manager of the Green Investments Program at Friends of the Earth–US in San Francisco, CDB is the only Chinese bank to adopt its own environmental financing standards. She said: "Based on publicly available data, only one Chinese bank – China Development Bank – has adopted its own environmental financing standards." [1].
[edit] Executives at CDB
Chen Yuan Governor
Born in January 1945. Graduated with a Master' s degree in Industrial Economics from the Graduate School of Chinese Academy of Social Sciences. Appointed secretary of the Xicheng District Committee of the Beijing Municipal Committee of the Communist Party (CPC) and director-general of the Beijing Municipal Commerce and Trade Department in August 1982; assumed the post of deputy secretary of the leading party members' group and vice governor of the People' s Bank of China in March 1988; secretary of CPC China Development Bank Committee and governor of CDB from March 1998 to the present.
Yao Zhongmin Vice Governor
Born in June 1952. Graduated with a Master' s degree in Investment Economics from Central South China University of Finance and Economics. Appointed president of the Henan provincial branch of China Construction Bank in June 1992; assumed the post of vice governor of the Henan Provincial Government in April 1993; appointed vice governor of China Development Bank in January 1994; now serves as deputy secretary of the CPC China Development Committee and vice governor of CDB.
Wang Yi Vice Governor
Born in April 1956. Graduated with a Doctor' s degree in Economics from Southwest China University of Finance and Economics. Appointed vice director of the General Office of the Securities Committee of the State Council in September 1992; assumed the post of vice chairman of China Securities Regulatory Commission in October 1995; member of the CPC China Development Bank Committee and vice governor of CDB from January 1999 to present.
Liu Kegu Vice Governor
Born in May 1947. Graduated with a Doctor' s degree in Finance from Northeast China University of Finance and Economics. Held the posts of vice director of the Department of Finance and Taxation System Reform and director of the Department of Taxation Policy of the Ministry of Finance between March 1990 and October 1996; held the posts of assistant to governor of Liaoning Provincial Government (later concurrently director-general of the provincial Department of Finance), Vice Governor of Liaoning Provincial Government (later concurrently Secretary of Enterprise Work Committee of the CPC Liaoning Provincial Committee), and chairman of Liaoning Provincial State Assets Administration and Supervision Committee between October 1996 and September 2002; member of the CPC China Development Bank Committee and vice governor of CDB from September 2002 to the present.
Gao Jian Vice Governor
Born in August 1949. Graduated with a Doctor' s degree in Finance from the Institute of Financial Sciences of the Ministry of Finance. Successively held the posts of vice director of the Department of Laws and Regulations, vice director of the Department of State Debt Administration, director of the Department of State Debt Administration and director of the Department of Laws and Regulations of the Ministry of Finance between September 1990 and October 1998; assumed the post of chief economist, director of Treasury Department and concurrently chief representative of the Hong Kong Office of China Development Bank in October 1998; appointed member of the CPC China Development Bank Committee, assistant to governor and concurrently director of the Treasury Department and chief representative of the Hong Kong Office of China Development Bank in April 2001; member of the CPC China Development Bank Committee and vice governor of CDB from July 2003 to the present.
Li Changfu Chief Compliance Officer
Born in January 1945. Graduated with a Major in Machinery Manufacturing from Shandong Institute of Farm Machinery. Held the post of vice director and member of the leading party members' group of North China Electric Power Industry Bureau in May 1991; came to China Development Bank in September 1995 and successively held the posts of director of the Department of Power Credit Administration and director of the Energy & Water Conservancy Project Appraisal Department of China Development Bank; member of the CPC China Development Bank Committee and secretary of the Commission for Discipline Inspection from August 1998 to the present.
Zhao Jianping Assistant Governor
Born in July 1953. Graduated with a Master' s in International Corporate Management from the Management School of the University of Texas. Successively held the posts of deputy general manager and general manager of the Business Department of Bank of China' s Hong Kong and Macao Office (concurrently senior executive vice president of BOC International Holdings Ltd.) between March 1993 and November 1998; appointed a member of the leading party members' group and vice director of State Administration of Foreign Exchange in November 1998; assumed the posts of member of the CPC China Development Bank Committee, assistant to governor and concurrently director of the Treasury Department of CDB in December 2001; member of the CPC China Development Bank Committee and assistant to governor from January 2004 till present.
Xu Yiren Assistant Governor
Born in January 1949. Graduated with a Master' s degree in World Economics from the Party School of the CPC Central Committee. Appointed vice director of the Economic, Scientific and Technological Personnel Bureau of the Organization Department of the CPC Central Committee in May 1997; appointed head of the Organization Department and director of the Personnel Department of the CPC China Development Bank Committee in March 1999; member of the CPC China Development Bank Committee, assistant to governor and concurrently director of the Personnel Department of CDB.
[edit] The following description is from CDB's website.
China Development Bank, founded in March 1994, is under the direct jurisdiction of the State Council. At present it has 32 branches and four representative offices across the country. Over the past decade CDB has followed conscientiously China' s macroeconomic policies and carried out its macro-control functions in support of national economic development and strategic structural readjustment. CDB has been a major player in long-term financing for key projects and supportive construction in infrastructure, and basic and pillar industries, which are vital to the development of national economy.
As a development-oriented financial institution of the government, CDB has adhered to the principle of advancing with the times. It combines the bank' s advantage in financing with that of the government in organizational aspects and tries to realize the government' s development objectives by nurturing the market. It supports China' s economic development by building up the institutional driving power and works hard to realize the dual objectives of project funding and financial institutionalization.
Over the past decade, CDB has issued an accumulated total of 1.6 trillion yuan in loans to more than 4,000 projects involving key fields of infrastructure, and basic and pillar industries. It is omnipresent across China – in areas along the Yellow River and both to the south and north of the Yangtze River, in regions as far as northwestern frontiers and southeast coasts, and in both Western Development endeavors and revitalization of Northeast China' s old industrial bases. CDB functions as a bridge and link between the government and the market in the implementation of the country' s key projects. It also helps configurate the country' s credit structure and "lays the road" and "builds the bridge" to channel social investment.
In recent years CDB has concentrated its limited resources in developing "bottleneck" trades that astrict China' s economic development, such as energy and transportation. Meanwhile, it guards against the flow of loans to fields with a high occurrence of overlapped construction. By 2003 CDB had either made loan arrangements for or evaluated and underwritten a total of 460 national debt projects and issued 246.8 billion yuan of loans, which accounted for 41% of its total investment; its loans to "bottleneck" trades and fields that the government gives support priorities amounted to 91% of the total; and it had issued accumulatively 357.5 billion yuan of loans to western areas and 174.2 billion yuan to old industrial bases in Northeast China. All these efforts have greatly propelled economic growth and structural readjustment of China.
Since 1998 CDB, led by Governor Chen Yuan, has tried to introduce the world' s advanced financial principles and concepts into Chinese realities and adopt them into CDB' s guiding principles of reconciling state credit with market performance and operating "within the market environment and banking framework." It has been targeting international standard in its reform endeavors, which, as a result, have brought about a boom in development-oriented finance. Meanwhile, CDB has harvested in good market performance, and its major performance indexes have reached the world' s advanced level. As of the end of 2004, the bank's credit assets amounted to RMB1378.6 billion, with current principal and interest recovery ratio of 99.77%, the indicator having maintained world-leading performance for 20 consecutive quarters; the bank's non-performing loan ratio stood at 1.21%, down a year-on-year 0.13 percentage points; the coverage ratio of its risk reserves against non-performing loans hit 285%, and; its capital adequacy ratio reached 10.51%.
In retrospect, CDB has transcended many difficulties to come up to its present success. It is confident of its future and aims to become a development-oriented financial institution of the world' s top-rank market performance. CDB will follow the concept of scientific development in its development-oriented financial operations and build itself into a banking institution that nurtures the market by using state credit, that finds solutions to the government' s priorities through market functions, and that is capable of upgrading China' s competitiveness. It will extend its achievements in infrastructure to new basic and pillar industries that emerge in the course of constructing China into a well-off society. It will try to alleviate and finally eliminate resource and supply restriction "bottlenecks" and institutional "bottlenecks" through development-oriented finance that is marked by internationally advanced market performance. At the same time it will continue to open up financing channels while sticking to the principle of "Five Aspects Coordination." In the course of financing, CDB aims to promote construction of governance structure, enterprise system as a legal entity, cash flow management system and credit culture. It strives to become a pioneer, pacesetter and vanguard in the construction of socialist market economic system, in order to propel China' s overall, concerted and sustainable economic and social development.
