(Yicai) March 14 -- China Vanke is seeking to raise as much as CNY80 billion (USD11.1 billion) in syndicated loans from 12 banks to help the cash-strapped property developer repay maturing bonds, according to a market rumor.

The banks include large state-owned lenders such as China Construction Bank and six joint-stock banks like China Merchants Bank, China Citic Bank, and Ping An Bank, according to the information circulating on Chinese social media on March 12. 

Yicai contacted several bankers for confirmation but did not receive a definite answer. Some said the plan proposed in the information circulating online is feasible, but considering the lack of a guarantee from Shenzhen’s state-owned assets manager and other factors, other forces are needed to push it forward.

Affected by the rumor, Vanke’s shares [SHE: 000002] ended 3.1 percent lower at CNY9.69 (USD1.35) in Shenzhen yesterday. Ping An [SHE: 000001] closed down 2.2 percent at CNY10.33 (USD1.44), China Pacific Insurance [SHA: 601601] tumbled 7.1 percent to CNY23.30 in Shanghai, and Xinhua Insurance [SHA: 601336] fell 4.2 percent to CNY30.97.

Today, Vanke rose 0.2 percent, Ping An Bank dropped 1 percent, China Pacific Insurance slid 0.8 percent, and Xinhua Insurance fell 0.3 percent.

From the perspective of market debt, Vanke had 74 open market bonds worth CNY86.6 billion as of yesterday, with 40 worth CNY30 billion coming due this year, of which 15, totaling CNY15 billion, mature in the first six months of 2024, according to figures from data provider Wind Information.

The market has also made a new assessment of insurers' exposure to the real estate industry. Among non-public market bonds, Vanke borrowed CNY190.4 billion (USD26.5 billion) from banks as of the end of 2022, while borrowing based on bond guarantee plans totaled CNY38.1 billion, according to documents previously released by the firm.

The bond guarantee plan refers to the debt investment plan made by insurance funds and Vanke. Among the large amounts of non-traditional financing, Vanke's lenders include Xinhua Asset Management with CNY9.8 billion (USD1.4 billion), Taikang Asset Management with CNY4.6 billion, and Zhongyuan Trust with CNY3 billion.

Xinhua Asset Management has two tranches worth CNY4.4 billion, one expiring this December and the other in December 2025.

Earlier this month, information on social media said Vanke Chairman Yu Liang and other managers had visited Beijing for talks with New China Asset Management on extending the maturity of a CNY10 billion debt it owes the asset manager, but was turned down.

Vanke prepared enough funds and repaid a US dollar debt due on March 11. However, international rating agency Moody's announced that it had revoked Vanke's Baa3 issuer rating and assigned it a corporate family rating of Ba1 on the same day.

Vanke had CNY103.7 billion of monetary funds at the end of last September, around 2.2 times that of its short-term debts, the firm's latest data showed. 

Editor: Martin Kadiev