China’s Bad-Debt Managers Turn to Bank Stakes to Buffer Losses
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Two of China’s unlisted state-owned bad-debt managers reported surging asset-impairment losses for 2025, though paper gains tied to strategic investments in domestic banks helped shield their earnings from deteriorating loan quality.
China Great Wall Asset Management Co. Ltd. and China Orient Asset Management Co. Ltd. recently disclosed annual results showing asset-impairment losses jumped eightfold and threefold, respectively. Despite taking a combined hit of nearly 44.2 billion yuan ($6.5 billion), both firms remained profitable.
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- China Great Wall and China Orient reported 2025 asset-impairment losses of 28.5B yuan (up 8x) and 15.7B yuan (up 3x), totaling 44.2B yuan, yet stayed profitable with net profits of 2B yuan (+15.2%) and 476M yuan.
- Losses offset by accounting gains from bank stakes: Great Wall's 5% Minsheng, 3% CCB (investment income doubled to 8.9B yuan); Orient's 5% Pudong.
- Part of state restructuring: Central Huijin assumed control, injected 36.8B yuan into Great Wall after capital cut.
- China Great Wall Asset Management Co. Ltd.
- China Great Wall Asset Management Co. Ltd. reported 28.5 billion yuan in asset impairments for 2025, but net profit rose 15.2% to 2 billion yuan, boosted by doubled investment income (8.9 billion yuan) from 5% stake in China Minsheng Bank and 3% in China Construction Bank. Received 36.8 billion yuan capital injection from Central Huijin after 80% capital cut. (68 words)
- China Orient Asset Management Co. Ltd.
- China Orient Asset Management Co. Ltd. reported 15.7 billion yuan in asset-impairment losses for 2025, up threefold, yet posted a net profit of 476 million yuan. Gains from a 5% stake in Shanghai Pudong Development Bank, classified under equity method accounting, offset impacts of property slump and economic slowdown. Central Huijin assumed control via restructuring.
- China Minsheng Bank
- Great Wall Asset Management acquired roughly 5% of China Minsheng Bank in 2025, classifying it as a long-term investment under the equity method. This generated accounting gains, helping offset asset-impairment losses amid economic challenges.
- China Construction Bank
- China Great Wall Asset Management acquired a 3% stake in China Construction Bank in 2025 as a government-backed strategic investment, enabling equity-method accounting gains that boosted its investment income to 8.9 billion yuan.
- Shanghai Pudong Development Bank
- China Orient Asset Management Co. Ltd. bought a 5% stake in Shanghai Pudong Development Bank in 2025, classifying it as a long-term investment under the equity method to record accounting gains amid rising asset impairments.
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