The IFC invested $27m in a 15% stake in Nanjing, based in the capital of China’s fast-growing Jiangsu province, in 2001. So far no other foreign lenders have followed suit. The bank signed a co-operative agreement with South Korea’s Hana Bank in 2003.
In the past four years, the IFC has helped Nanjing to improve its credit and risk management polices, transforming it into a relatively well-run commercial lender by bringing its management in line with international practices. The bank’s NPL ratio was 3.32% by the end of June 2004, much lower than the 14.8% average for the country’s 111 city commercial banks. It has a capital adequacy ratio of 9.59%, above the 8% minimum requirement, and far exceeding the city banks’ average of 6.79%. Nanjing’s shareholders approved plans for a domestic IPO of about 700 million A shares to be sold to domestic investors this year.
