(Yicai Global) June 15 -- China Great Wall Asset Management, one of the country’s four largest asset managers, has joined forces with Hainan Haide Capital Management to enter the bulk personal bad loans transfer business, a market that has trillions of yuan’s worth of non-performing loans for disposal every year.

Haide Capital set up Wuhu Great Wall Weihai Investment with Great Wall Equity Investment Fund and three other firms to buy and dispose of individual NPLs on a large scale, it announced recently.

The market has more than CNY3 trillion (USD419 billion) of such NPLs available for disposal annually, the Haikou-based firm said in its 2022 annual trading report.

Great Wall Equity Investment Fund invested CNY48 million (USD6.7 million) in the joint venture for a 60 percent stake, while Haide Asset Management contributed CNY24 million for 30 percent.

Haide Capital, a private asset manager, became licensed to run a personal NPL disposal business in July 2021 and aims to manage CNY100 billion in the next three to four years.

The new JV will help the firm speed up its investment positioning in the field of personal NPLs, jointly form a personal NPL acquisition and disposal ecosystem with leading industry players, and expand the scale of the personal NPLs it manages, Haide Capital noted.

China Orient Asset Management was the only one of China’s top four asset managers to have ventured into the business since the bulk transfer pilot scheme started in 2021. It bought Ping An Bank’s first personal NPL package at auction in March that year at a 53 percent discount.

Local asset managers are the main force in the market for disposing of personal NPLs, accounting for 95 percent of the total since the pilot scheme began to the end of the third quarter of last year.

So far, eight local asset management companies have gained access to the credit reporting system of the People’s Bank of China, which is an important step in the NPL disposal business. Haide Capital applied last December.

Editor: Futura Costaglione