03/20/2020 | 11:34am EDT
Risk Assessment Report of Chemchina
Finance Co., Ltd.
as of December 31, 2019
TZYZ  No. 11883
Table of Contents
Risk Assessment Report————1
Risk Assessment Notes ————2
Risk Assessment Report of Chemchina Finance Co., Ltd.
as of December 31, 2019
TZYZ  No. 11883
Chemchina Finance Co., Ltd.,
We accepted your entrustment and reviewed the management’s evaluation and identification to the rationality of, and the effectiveness of execution, the risk management design associated with the financial statements of Chemchina Finance Co., Ltd. (hereinafter referred to as “Chemchina Finance”) as of December 31, 2019. The responsibility of Chemchina Finance’s management authority is to establish, improve and rationally design the risk management and keep its effectiveness, and the authenticity and integrity of risk management policies and procedures. We are responsible for commenting on the implementation of risk management relating to the accounting statements of Chemchina Finance.
During the review, we understood, tested and commented on the rationality and implementation of the risk management design by Chemchina Finance in respect of the preparation of accounting statements, and performed other procedures that we considered necessary. We believe that our audit provides a reasonable basis for our opinion.
Due to the inherent limitations of risk management, misstatements may occur and remain undiscovered due to errors or fraud. In addition, risk management may become inappropriate or the degree of conformity to control and risk management policies and procedures may decline due to changes in circumstances. Predicting the future effectiveness of risk management according to the risk assessment results is risky in some way. According to our understanding of and comments on the risk management, we did not find any significant defects in the risk management relating to the preparation of accounting statements of Chemchina Finance as of December 31, 2019.
This Report is used for Chemchina Finance to be reviewed by regulators only when conducting financial business. It shall not be used for any other purposes without written permission.
March 1, 2020
Risk Assessment Notes of Chemchina Finance Co., Ltd.
I. The Company’s Basic Situation
Chemchina Finance Co., Ltd. (hereinafter referred to as the “Company”) is a non-banking financial institution approved by China Banking Regulatory Commission (financial license code: L0100H211000001) and registered in the State Administration for Industry and Commerce of the People’s Republic of China (ID: L087H101110108001). The registered capital was CNY 632.50 million at the time of establishment. The registered place of business is No. 62 West Road, North 4th Ring Road, Haidian District, Beijing, China. The opening time was July 2, 2009. On October 12, 2016, as approved by Beijing Regulatory Authority of the CBRC, the Company’s capital was increased to CNY 841.225 million. The shareholders and their equity ratios were: China National Chemical Corporation (holding, 49.41%), China National Bluestar (Group) Co., Ltd. (26.88%), China Haohua Chemical Group Co., Ltd. (15.81%) and China National Agrochemical Co., Ltd. (7.9%).
As of now, the Company’s scope of business approved by China Banking Regulatory Commission covers financial and financing advisory services, credit verification and related consulting, agency business to member units; provision of security to member units; helping member units with the receipt and payment of transaction proceeds; the approved insurance agency business; the entrusted loans and investments among the member units; bill acceptance and discount to the member units; internal transfer and settlement and the design of appropriate settlement & liquidation programs among member units; taking the deposits of member units; loans and finance leases to member units; interbank lending; underwriting the corporate bonds of member units; fixed income portfolio investment. The business of spot foreign exchange settlement and sales has been approved by the Beijing Foreign Exchange Administrative Department of the State Administration of Foreign Exchange. Filed with the Cross-Border Office of Operations Office of the People’s Bank of China for record, the Company has the qualification to conduct two-waycross-border RMB capital pool
II. The Company’s Internal Control
- Control environment
The Company has a sound structure of corporate governance with the establishment of a governance structure consisting mainly of the “three boards (the Board of Shareholders, the Board of Directors, and the Board of Supervisors) and one management”. Each governing body has formulated complete rules of procedure and job responsibilities and held meetings as required. The management and operation are carried out in a scientific and normalized way, providing the necessary preconditions for the effectiveness of risk management. On the principle of ensuring checks and balances among the decision-making system, executive system and supervisory & feedback system, the Company has set up an organizational structure with reasonable division of labor, definite responsibilities and clear reporting relationships. The decision-making system includes the Board of Shareholders, the Board of Directors and their subordinate Risk Control Committee and Audit Committee. The executive system includes senior management and its subordinate Credit Review Committee, Assets and Liabilities Management Committee, Investment Decision-Making Committee and business functions. The supervisory & feedback system includes the Board of Supervisors and the Risk Control Department and Audit Department directly responsible to the Board of Directors, constructing the three working procedures and the risk control system of separated front, middle and back grounds.
The Company’s organization chart is as follows:
Risk Control Committee
Credit Review Committee
Assets and Liabilities
Department Customer VIP
Department Management Fund
Department Development Business
Department Business Settlement
Board of Directors: responsible for reviewing and approving the Company’s overall business strategy and major policies, determining the acceptable risk level of the Company, approving the policies, systems and procedures relating to each business, appointing the management, supervising the effectiveness of internal control, regularly discussing with the management about the
effectiveness of internal control, regularly reviewing the internal control assessment reports provided by the management, audit authority and supervision department, and urging the management to implement the rectification measures.
Board of Supervisors: responsible for supervising the Board of Directors and senior management to improve the internal control system, supervising the Board of Directors and directors, senior management and senior executives to perform the internal control duties, asking the directors, Chairman of the Board and senior executives to correct their actions against the interests of the Company and supervising the implementation. Each year, the Board of Supervisors will assess the performance of duties of directors and senior executives and report to the Board of Shareholders.
Risk Control Committee: responsible to the Board of Directors, as the supreme decision-making body for enterprises-wide risk management, for reviewing the Company’s risk management framework, developing risk strategies and basic risk management policies, supervising and inspecting the execution, supervising the senior management’s risk control in the Company, reviewing the judgment criteria or mechanism of the Company’s major decisions, major risks, major events and important business processes, examining and approving the identification of liability for non-performing assets and the disposal and verification plans of non-performing assets etc. The Risk Control Committee consists of 3 members including at least 2 directors.
Audit Committee: responsible to the Board of Directors for ceaselessly supervising the internal control system of the Company, reviewing the management rules and regulations of the Company and their implementation, checking and assessing the compliance and effectiveness of the Company’s major business activities, reviewing the Company’s financial information and its disclosure, and inspecting, supervising and evaluating the Company’s internal audit etc. The Committee consists of at least three members, of whom two are directors.
Senior management: responsible for the execution of the Board decisions, the development of internal control policies, monitoring and evaluation of the adequacy and effectiveness of the internal control system, the establishment and implementation of sound and effective internal control, and taking measures to rectify internal control problems. Further, they are responsible for the establishment of procedures and measures for identifying, measuring, monitoring and controlling risks, the establishment of an internal organizational structure characterized by definite authorization and responsibilities and clear reporting relationship, to ensure that the responsibilities of internal control are to be effectively fulfilled;
Credit Review Committee: responsible to the General Manager for reviewing and approving the relevant working systems and work procedures relating to credit business, and making examination
and approval decisions on the credit business and other businesses declared by the VIP Customer Department.
Assets and Liabilities Management Committee: responsible to the General Manager for monitoring the risk indicators in the Company’s on- and off-balance-sheet assets, implementing measures to prevent and resolve asset risks, examining the Company’s interest rates, rates and other price policies, and timely working out countermeasures and formulating adjustment plans according to the Company’s assets and liabilities and existing problems.
Investment Decision-Making Committee: responsible to the General Manager for reviewing the annual investment strategy and annual investment plans, formulating risk management policies and strategies for portfolio investment, examining and approving the portfolio investment business within the authority of the Board of Directors.
Business Departments: the Company’s credit, fund, settlement, financial, information and other departments involve most of the Company’s assets and businesses and directly face various risks in daily work, constituting the frontline of the Company’s risk management. Each business department undertakes the following risk management responsibilities:
- Fully understanding and analyzing various risks in their department(s) to ensure that all businesses are conducted in accordance with the established procedures and that all internal control measures are effectively implemented;
- Recording and archiving the results of risk assessment and the implementation of internal control measures, accurately and promptly reporting the daily risk monitoring reports required by the Risk Control Department;
- Ceaselessly testing and assessing the effectiveness of internal control measures, and proposing improvement suggestions on operational procedures and internal control measures to the Risk Control Department; and
- Identifying and reporting any possible categories of risks in a timely manner and offering risk management suggestions.
Risk Control Department: As the specific implementation department for the decisions of the Risk Control Committee, responsible for leading and coordinating the risk management of the Company’s departments, with main responsibilities of formulating the Company’s risk management policies and systems, supervising and warning the risks of various business activities of the Company; organizing and implementing early warning, monitoring, analysis and implementation of internal control systems for all kinds of risks, and writing risk assessment reports, organizing the
research and audit of the Company’s rules and regulations, operational procedures, and reviewing customer credit rating evaluation methods and standards, organizing the implementation of asset risk classification and verification and authenticity inspection, and organizing the management and disposal of non-performing assets transferred, managing the Company’s general legal affairs, and conducting compliance review of the Company’s policies, procedures and systems.
Audit Department: independent from the business and management layers, responsible for evaluating the Company’s internal control, with primary responsibilities of conducting comprehensive audits and supervision of various departments, positions and operations, reporting regularly to the Board of Directors or its subordinate Audit Committee, and tracking the proposed rectification.
(II) Risk identification and assessment
The implementation of the internal control of the Company is organized by the Risk Control Department and supervised and evaluated by the Audit Department. All departments and agencies formulate their own different risk control systems, standardized operational procedures, operating standards and risk (including credit risk, operational risk, liquidity risk and compliance risk) prevention measures within the scope of their responsibilities according to different characteristics of each business. The departments have separated responsibilities and are mutually supervised. Various risks in the proprietary operation are predicted, evaluated and controlled.
(III) Control activities
1. Fund management
Based upon all rules and regulations of the China Banking Regulatory Commission, the Company has formulated the Fund Management Measures of Chemchina Finance Co., Ltd., Measures for the Management of Deposit Business of Chemchina Finance Co., Ltd., Measures for the Management of RMB Settlement Account of Chemchina Finance Co., Ltd., Measures for the Management of Foreign Exchange Accounts of Chemchina Finance Co., Ltd., Settlement Business Management Measures of Chemchina Finance Co., Ltd., Internal Risk Control System for Settlement Business of Chemchina Finance Co., Ltd., Measures for the Management of Use of Online Banking System of Chemchina Finance Co., Ltd., Measures for the Management of Bank Accounts of Chemchina Finance Co., Ltd., Measures for the Management of Fund Liquidity Risk of Chemchina Finance Co., Ltd., Measures for the Management of Interest Rate Risks in Bank Accounts of Chemchina Finance Co., Ltd., Measures for Assets and Liabilities Management of Chemchina Finance Co., Ltd., Measures for the Management of Pricing of Deposit and Loan Interest Rates of
Chemchina Finance Co., Ltd. and other business management measures and operation procedures, so that the business risks are first controlled by the rules of practice and control standards set forth in the procedures and processes.
- In terms of fund plan management, the Company’s business operations are strictly following the asset and liability management rules set forth in the Management Approach for Finance Companies of Enterprise Groups to ensure the safety, profitability and liquidity of the Company’s funds by formulating and implementing the fund plan management.
- In terms of deposit business for member units, the Company strictly follows the principles of equality, voluntariness, fairness and good faith to protect the funds of member units and safeguard the legitimate rights and interests of all parties concerned.
- In terms of transfer and settlement business, member units open settlement accounts in the Company and submit instructions for funds settlement online through the Company’s settlement platform to ensure safe, fast and smooth settlement of accounts with high data security.
- In terms of bank financing, the Company has established the Measures for the Management of Discount by Transfer and Operation Procedures of Chemchina Finance Co., Ltd. and Measures for the Inter-bankLending Management of Chemchina Finance Co., Ltd., and strictly followed the limits on business scope and scale stipulated by the CBRC and the PBC in practice.
2. Accounting business control
In accordance with the requirements of the accounting system, the Company has established and implemented the standardized accounting procedures. The Company has established an independent financial accounting department so that the accounting department and accounting personnel can independently handle the accounting business in accordance with the unified national accounting system. The Company has clearly defined the privileges of the accounting department and accounting personnel. The accounting personnel shall handle the relevant business within their respective powers. Any business beyond such powers must be subject to further authorization. The principle of separation of duties and mutual restraint is practiced for the Company’s settlement and accounting positions. One person is strictly prohibited from serving on incompatible positions or completing the entire process of settlement and accounting operations alone. The Company will reconcile the accounting books with the physical objects, funds and related materials on a regular basis to ensure that the relevant contents between the records and the physical objects, notes, payments, documents, accounts and statements are consistent.
In accordance with the principle of concierge management, mutual restraint, proper review and
approval and strict registration, the Company strengthens the management of contracts, notes, seals and keys, and separated custody of seals and bills. For important contracts and notes, serial number control, obsolescence control, blank voucher control, recipient registration control and other special measures are implemented. In case of any changes in accounting personnel, handover procedures are conducted with the receivers as strictly supervised by the supervisor.
3. Credit business control
The receivers of the Company’s loans are limited to the member units of China National Chemical Corporation. According to the different characteristics of various businesses, the Company has formulated the Management of Comprehensive Credit Granting in Credit Business of Chemchina Finance Co., Ltd., Measures for Loan Management of Chemchina Finance Co., Ltd., Operation Procedure for Loan Business of Chemchina Finance Co., Ltd., Measures for the Management of Customer Credit Rating of Chemchina Finance Co., Ltd., Measures for the Management of Post-loanInspection of Chemchina Finance Co., Ltd. and Measures for the Management of Commercial Drafts Discount of Chemchina Finance Co., Ltd. etc. With constant revision and improvement, the Company has standardized the business operation processes and established the complete pre-loan,in-loan and post-loan credit management system.
- A system of separated credit review and approval has been established with definite responsibilities and mutual restraints.
The Company determines the review procedures and approval authority according to the scales, types, terms and guarantee conditions of the loans, then reviews and approves the loans in strict accordance with the procedures and authorities.
The Company has established and improved the responsibility system of the credit department and credit posts, which are of well-defined functions and clear-cut responsibilities. Loan investigation and appraisal personnel take charge of credit investigation and appraisal and are liable for investigation errors and inaccurate appraisal; the loan reviewers take charge of the review of credit risks, and are liable for the review errors; the loan originators take charge of the check and collection of loans, and are liable for check errors and poor collection.
The Company has established an effective mechanism for loan decision making. The Credit Review Committee has been set up to review various types of credit businesses submitted for consideration by relevant departments. The Committee considers and votes on the principle of collective review, express opinions, and majority rule, and all the opinions are recorded. For the project approved by the Credit Review Committee, General Manager has a veto; for those not
approved by the Credit Review Committee, General Manager shall never give credit or issue loans.
- The post-loan management system is strictly implemented. The VIP Customer Department is responsible for monitoring and managing loan applications, interest receipts, overdue loans and rollover loans, and carries out post-loan inspection on the safety and recoverability of loans.
The Company has set up an asset risk classification system to normalize the standards and procedures for the identification of asset quality. The authenticity of the asset quality must be ensured and it is forbidden to cover up the real situation of non-performing assets.
- Customer management information files have been established to have a comprehensive and centralized grasp of customer information such as creditworthiness, financial status and solvency. Customers are subject to classified management so that those “blacklisted” borrowers of bad credit standing or involved in debt evasion and revoking are banned credit.
4. Investment business control
The Company obtained the qualification to conduct fixed income securities investment business on December 21, 2016. In 2018, the Company started its investment in the monetary fund and the bond investment business of the Group. In order to keep the risks in investing new businesses controllable, the Company has established the Investment Decision-Making Committee, developed investment strategies and plans, formulated and implemented the Working System of Investment Decision-MakingCommittee of Chemchina Finance Co., Ltd., Measures for the Management of Negotiable Securities Investment Business of Chemchina Finance Co., Ltd., Rules for the Management of Bond Investment Business of Chemchina Finance Co., Ltd., Rules for Operation of Monetary Fund of Chemchina Finance Co., Ltd., Rules for the Management of Securities Trading Accounts of Chemchina Finance Co., Ltd., Measures for the Management of Investment Business Risks of Chemchina Finance Co., Ltd. and other investment business management systems, identified and evaluated the investment business risks, and established a hierarchical authorization system of investment businesses.
In terms of risk management, the Company has established an organizational structure of investment business risks, in which the risk limits are set based on the target that regulatory indicators get full scores in rating to monitor the implementation of the quotas and the level of regulatory indicators.
In terms of system construction, in order to embed various regulatory provisions and internal control requirements into the information system, the Company initiated the development of the investment business system, and is currently in the selection development stage.
5. Internal audit control
The Company implements internal audit and supervision system. An internal audit department responsible for the Board of Directors – Audit Department has been set up. Internal audit management methods and operating procedures are established for the performance of internal audit and oversight of various economic activities of the Company.
The Audit Department is responsible for the Company’s internal audit, i.e. assessing the adequacy and effectiveness of the following controls over risks within the organization such as internal governance, operation and information systems: the reliability and integrity of financial and operational information; the efficiency and effectiveness of operations and procedures; the security of assets; compliance with laws, regulations, policies, procedures and contracts; and proposing valuable improvement opinions and suggestions to the management.
6. Information system control
The Company has established an overall control system of the computer information system, in an effort to strengthen the general control and application control to the computer information system. The Company has strictly divided the responsibilities of computer information system development, management and application departments, established and improved the risk prevention systems and measures of computer information system. The Company has developed the Measures for Emergency Management of Information System of Chemchina Finance Co., Ltd., Measures for the Management of Remote Disaster Recovery System of Chemchina Finance Co., Ltd., Information Security Management Measures of Chemchina Finance Co., Ltd., Outsourcing Management Measures of Chemchina Finance Co., Ltd. and other management systems, in line with the Information System Risk Management Guide for Banking Financial Institutions (YJH  No. 63), Basic Requirements of Information System Security Grade Protection and other regulatory requirements.
The system is constructed according to the commercial bank information construction standards from the perspectives of physical security, network security, host security, application security, data security and backup and recovery, and technical means such as access control and intrusion prevention, CA certification encryption technology, dual-computermulti-levelthree-dimensional protection are utilized to ensure the security and stability of the system. The main features are dual Internet link, dual redundant hot standby technology, stable and reliable business platform; the data transmission encryption, RAID and data offline backup technology are employed to effectively ensure the data security; The core layer of the information system network environment is configured with two Cisco firewalls (transparent mode) and two TOPSEC firewalls (routing mode),
realizing the heterogeneity of network security equipment. Deployment of Internet behavior management system, monitoring platform, bastion host, virus server, leakage and anti-attack modules; in terms of host, storage and backup, the core of the Company’s information system adopts the security architecture of two locations and three centers, the production host adopts the double hot standby, and the two storages form the mirror mode; the adoption of personal CA certificate for authentication has effectively identified the user identity, and prevented impersonation, tampering and repudiation. The development, management and application of the information system are separated from each other. The information system is managed by specially assigned full-time persons from IT Department. The information system is subdivided into different business departments according to the business modules, and the operation authorities are granted by General Manager of the Company to the operators within their business scope. Specific operations are divided by the operators according to the Company’s business departments, with each performing his own functions.
(IV) Emergency preparation and response
In order to carry out the directive spirit of the CBRC and the Beijing Municipal Government that “Everything matters in financial industry and in Beijing”, the Company has paid persistent attention to risk management as its daily routine, formulated and submitted the Emergency Response Plans of Chemchina Finance Co., Ltd. on Contingencies and Measures for the Management of Fund Liquidity Risk of Chemchina Finance Co., Ltd., and designed the emergency response plans and procedures for the situations where financial safety of Chemchina Finance is affected by operations or other issues, in an effort to identify possible contingencies or emergencies (including computer systems), prevent or minimize the potential losses and ensure the continuous operation of the businesses. In addition, Article 80 of the Articles of Association states: “When China National Chemical Corporation increases its capital in accordance with the actual needs of solving the urgent payment difficulties of Chemchina Finance, it shall be immediately reported to the China Banking Regulatory Commission.”
(V) Overall evaluation of internal control
The Company has implemented the “abolishing, revising and formulating” systems. By systematically reviewing the existing rules and regulations and operational procedures in each business, revising the clauses that do not meet the internal control requirements of the regulatory authorities, and timely abolishing the rules and regulations that no longer apply, it has effectively improved the compliance of the existing rules and regulations, providing a strong support for compliant operations and management of all businesses. On the whole, the Company’s internal
control system is sound and the implementation is effective. In terms of capital management, the Company has better controlled the risks of fund flow; in terms of credit business, the Company has established the appropriate credit business risk control procedures, so that the overall risk control is in a reasonable level.
Effective information exchange and feedback mechanisms have been established to ensure that the Board of Directors, the Board of Supervisors and the management team keep abreast of the Company’s operation and risk situation, that every piece of information can be communicated to the relevant employees, and that all relevant departments and employees can provide feedback smoothly. The information exchange and feedback mechanisms for risk management mainly include the following aspects:
- The Risk Control Department reports regularly the risk management situation to the Board of Directors and the Board of Supervisors every year.
- Feedback is promptly delivered to the relevant departments and employees.
- The Company strengthens the internal training and learning of risk management to raise the risk management awareness of all employees.
- The Company has established the internal control report and information feedback systems. In case business departments, internal audit departments and other control personnel identify any hidden dangers and defects of internal control, they can timely report to the management or departments concerned.
- The Company’s Audit Department conducts periodic inspection and assessment to the construction and implementation of the internal control systems, puts forward suggestions for improvement and gives advice on punishing the entities and individuals in violation of the provisions.
- The Company has established a mechanism to rectify internal control issues and defects. The management puts forward rectification opinions and corrective actions based on the inspection and assessment results of internal control, and urges the business departments to implement them.
- The Company’s Business Management and Risk Management
- Business conditions
As of December 31, 2019, Chemchina Finance’s total assets are CNY 16.656 billion, including net loans of CNY 8.077 billion, total liabilities of CNY 15.248 billion, deposit taking of CNY 15.184
billion from member units, owners’ equity of CNY 1.408 billion, 2019 realized revenues of CNY 383 million, total profit of CNY 104 million and net profit of CNY 78 million.
Since its establishment, the Company has always adhered to the principle of prudent operation, and strictly complied with the Company Law of the People’s Republic of China, Law of the People’s Republic of China on Regulation of and Supervision over the Banking Industry, Accounting Standards for Business Enterprises, Management Approach for Finance Companies of Enterprise Groups and the national financial regulations, rules and the Company’s articles of association to standardize the business practices and strengthen the internal management.
Based on the regulatory requirements of listed companies, the Company shall check the deposits of listed companies daily in order not to exceed the deposit limits disclosed; Meantime, according to the risk management requirements of some listed companies, daily monitoring and weekly feedback are given to the proportion of listed companies’ deposits in the total deposits of the Company.
3. Regulatory indicators
According to Article 34 of the Management Approach for Finance Companies of Enterprise Groups, as of December 31, 2019, Chemchina Finance’s regulatory indicators are in line with the requirements:
(1) The capital adequacy ratio shall not be less than 10%:
Capital adequacy ratio = Net capital / Risk-weighted assets = 14.40%
The Company’s capital adequacy ratio was 14.40%, in line with the regulatory requirements.
(2) The non-performing asset ratio shall not exceed 4%
Non-performing asset ratio = Bad credit risk assets / Credit risk assets = 0
The Company’s non-performing asset ratio was zero, in line with the regulatory requirements.
- The non-performing loan (NPL) ratio shall not exceed 5% NPL ratio = NPL / Loans = 0
The Company’s NPL ratio was zero, in line with the regulatory requirements.
- The adequacy ratio of reserves for asset loss shall not be less than 100%
Adequacy ratio of reserves for asset loss = Actual reserves of credit risk assets / Required reserves of credit risk assets = 182,592.58%
The Company’s adequacy ratio of reserves for asset loss exceeded 100%, in line with the regulatory requirements.
(5) The adequacy ratio of reserves for loan loss shall not be less than 100%
Adequacy ratio of reserves for loan loss = Actual reserves for loan loss / Required reserves for loan loss = Infinite
The Company’s adequacy ratio of reserves for loan loss exceeded 100%, in line with the regulatory requirements.
- The balance of funds from other banks shall not be higher than the total capital: Fund borrowing ratio = Inter-bank borrowing / Total capital = 0
The Company’s fund borrowed from other banks was less than the capitalization, which is in line with the regulatory requirement.
- The ratio of investment to total capital shall not exceed 70% Investment ratio = Investment / Total capital = 6.53%
The Company’s investment ratio was 6.53%, in line with the regulatory requirements.
- The guarantee ratio shall not exceed 100%:
Guarantee ratio = (Credit business equivalent to loans – Security deposit – Bank deposit receipts – National debts – Bank acceptance) / Total capital = 6.75%
The Company’s guarantee ratio was 6.75%, in line with the regulatory requirements.
- The ratio of owned fixed assets to total capital shall not exceed 20%: Ratio of owned fixed assets = Owned fixed assets / Total capital = 0.15%
The ratio of the Company’s own fixed assets to total capital was 0.15%, in line with the regulatory requirements.
- The liquidity ratio shall be no less than 25%: Liquidity ratio = Liquid assets / Liquid liabilities = 63.70%
The Company’s liquidity ratio was 63.70%, in line with the regulatory requirements.
(11) Shareholders’ Deposits and Loans (Unit: CNY 10,000)
Name of shareholder
China National Agrochemical Co.,
According to Article 46 of the Management Approach for Finance Companies of Enterprise Groups, “If the balance of loans granted by the finance corporation to a single shareholder exceeds 50% of the registered capital of the finance corporation or the shareholder’s contribution to the finance corporation, it shall be promptly reported to the China Banking Regulatory Commission”. The Company reports quarterly to the Beijing Regulatory Authority of China Banking Regulatory Commission.
To sum up, the Company has legal and valid Financial License, Business License for Legal Person, has established a relatively complete and reasonable internal control system, and can better control the risks. The Company has never experienced a run of deposits, nonpayment of matured debts, large loans overdue or guaranteed advances, neither robbery nor fraud, directors or senior executives involved in severe disciplinary violations, criminal cases or other major matters; the Company has never suffered from any major organizational changes, equity transaction or operational risks that might affect its normal operation; the Company has never been punished or ordered to rectify by the China Banking Regulatory Commission or other regulators; there was no violation of the Management Approach for Finance Companies of Enterprise Groups promulgated by the China Banking Regulatory Commission, and all the regulatory indicators met the requirements of Article 34 of the Management Approach.
Chemchina Finance Co., Ltd.
March 1, 2020
Blue Star Adisseo Co. Ltd. published this content on 21 March 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 20 March 2020 15:33:02 UTC
What is a Credit Builder Loan and Where Do I Get One?
Your credit score plays an important role in your financial life. If you have good credit you can qualify for loans and borrow money at lower interest rates. If you don’t have a credit score or have poor credit, it can be hard to get loans and you’ll be forced to pay higher rates when you do qualify.
Building credit can be like a chicken and egg problem. If you have no credit or bad credit, you’ll have trouble getting a loan. At the same time, you need to get a loan so you have an opportunity to build credit.
What Is a Credit Builder Loan?
A credit builder loan is a special type of loan designed to help people who have poor or no credit improve their credit score.
In many ways, credit builder loans are less like loans and more like forced savings plans. When you get a credit builder loan, the lender places the money in a bank account that you can’t access. You then start receiving a monthly bill for the loan. As you make those payments, the lender reports that information to the credit bureaus, helping you build up a payment history. This improves your credit score.
Once you finish the payment plan, the lender will release the bank account to you and stop sending bills.
In the end, you’ll wind up with slightly less money than you paid overall, due to fees and interest charges. For example, let’s say you get a credit builder loan for $1,000, the lender may make you make a monthly payment of $90 each month for a year. After the year ends, you’ll get the $1,000 from the lender, but may pay $1,080 overall.
Why Get a Credit Builder Loan?
The main reason to get a credit builder loan is right in the name: They help you build your credit. If you don’t have any credit history or if you’ve damaged your credit by missing payments, it’s much easier to qualify for a credit builder loan than a traditional loan from a lender.
The companies offering credit builder loans take on almost no risk because they don’t give you the money until you’ve finished paying the loan, so they’re willing to approve people who have severely damaged credit.
Credit builder loans will help you build your credit history if you make your monthly payments, but you do have to pay fees and interest to do so. There are other ways to build credit that don’t require paying any money. For example, if you get a fee-free credit card and pay your balance in full each month, you’ll build credit without paying any interest or fees.
This makes credit builder loans best for people who have tried and failed to qualify for other loans and credit cards.
There is also some value in the forced savings provided by credit builder loans, but the interest and fees eat away at that savings. If saving is your goal, it’s best to use a different strategy to help you save, but if you want to save and build credit at the same time, a credit builder loan might be worth using.
Where to Find Credit Builder Loans?
There are many companies that offer credit builder loans. Each lender offers different loan terms, fees, and interest rates.
One of the top credit builder loan providers is Self. The company offers credit builder loans with payment plans as low as $25 per month, making it easy for almost anyone to afford a credit builder loan.
With Self, you can also qualify for a Visa credit card after you’ve made at least 3 payments on your credit builder loan and made $100 of progress toward paying off the loan. You can set your own credit limit, up toward the total amount of progress you’ve made on the loan.
The card doesn’t have any additional upfront costs and can help you gain experience with using a credit card. It can also help you build your credit by giving you another account to make payments on, providing you with more opportunities to build a good payment history.
What to Look for?
When you’re looking for credit builder loans, there are a few factors to consider.
The first thing to think about is the monthly payment. The point of a credit builder loan is to show the credit bureaus that you can make regular payments on your debts, which will help build your credit score. If a lender’s minimum payment is more than you can afford each month, you won’t be able to build your credit with that lender’s credit builder loan.
It’s also important to think about the cost of the loan. Credit builder loans often come with stiff fees and you also have to pay interest on the money you’ve borrowed, even if you don’t get access to it until you pay the loan off.
The fewer fees and the less interest you have to pay, the better. You should look very carefully at each lender’s fee structure to choose the best deal.
Finally, take some time to see how easy it is to qualify. While credit builder loans are targeted at people with bad credit, some lenders will still check your credit history and might deny your application.
If you have very bad credit, you might want to look for a lender that advertises credit builder loans with no credit check.
Alternatives to a Credit Builder Loan
Credit builder loans can be a good way to build credit for some people, but they come with interest charges and fees. There are other ways you can build credit worth considering. Some of them won’t cost any money, which may make them a better choice than a credit builder loan.
Secured Credit Cards
A secured credit card is a special type of credit card that is much easier to qualify for than a typical card.
With a secured card, you have to provide a security deposit when you open the account. The credit limit of your card will usually be equal to the deposit you provide. For example, if you want a $200 credit limit, you’ll have to give the card issuer $200 as collateral.
Because you give the lender cash to secure the card, it’s much easier to qualify for a secured credit card. The lender assumes almost no risk. Once you get the card, it works like any other credit card. You can use it to spend up to your credit limit and you’ll get a bill each month. If you pay the bill on time, you can build credit.
Many secured cards charge high interest rates and have hefty fees, but there are some fee-free options available. One great secured card is the Discover it Secured Credit Card, which has no annual fee and offers cash back rewards.
Become an Authorized User
Most credit card issuers let cardholders add other people as authorized users on their accounts. Authorized users get their own cards and can use them to spend money just like the main cardholder.
Some issuers will report account information to the credit reports of both the main cardholder and any authorized users. If you know someone that is willing to make you an authorized user on their credit card account, this may help you build your credit so you can qualify for a card of your own.
Not every issuer will report information to authorized users’ credit reports. It’s also worth keeping in mind that if you become an authorized user on a card and the cardholder stops making payments or racks up a huge balance, that will show up on your report as well, damaging your credit further. That can make this strategy risky.
Personal Loans with a Cosigner
Personal loans are highly flexible loans that you can use for almost any reason. If you need to borrow money, you can try to find someone who is willing to cosign on the loan. Having a cosigner can make it easier to qualify, even if you have poor credit, giving you a chance to build your credit score.
When someone cosigns on a loan, they’re promising to take responsibility for your debt if you stop making payments. Lenders will look at both your credit and your cosigner’s credit when you apply, so having a cosigner with strong credit can help you get the loan or reduce the interest rate of the loan.
Keep in mind that your cosigner is putting themselves at risk by cosigning on a loan. It’s even more important that you make your payments every month. If you don’t, your cosigner will have to pick up the slack.
Personal Loans without a Cosigner
Even if you have poor credit, you may be able to qualify for a personal loan designed for people that don’t have strong credit. Just keep in mind that you’ll have to pay higher fees and interest rates to compensate for your poor credit score.
If you’re looking for a personal loan and have poor credit, shopping around for the best deal becomes even more important. You can use a loan comparison site, like Fiona, to get quotes from multiple lenders so you can find the cheapest loan.
Related: Best Emergency Loans for Bad Credit
What Is the Difference Between a Credit-Builder Loan and a Personal Loan?
A personal loan is a type of loan that you can get for almost any reason, such as consolidating debts, starting a home improvement project, paying an unexpected bill, or even going on vacation. They’re offered by many lenders and banks.
A credit builder loan is less a loan and more a forced saving plan. When you get a credit builder loan, the lender doesn’t actually give you any money. Instead, it places the amount you’re borrowing in an account you can’t access. Once you finish paying the loan, the lender releases the money in that account to you.
Credit builder loans tend to be much easier to qualify for than personal loans because the lender doesn’t have to take on much risk. They’re mostly used by people who want to build or rebuild their credit score.
On the other hand, personal loans are less popular for building credit and more useful for providing funding when borrowers need cash to cover an expense.
Pros and Cons of a Credit Builder Loan
Before applying for a credit builder loan, consider these pros and cons.
- Easy to qualify for
- Helps you build savings
- Payments are usually small
- Helps you build payment history
- Not really a loan
- Fees and interest rates can be high
- There are cheaper alternatives to build credit
These are some of the most frequently asked questions about credit builder loans.
Like most loans, it is possible to repay a credit builder loan ahead of schedule, but there are a few downsides to consider. One is that many lenders add an early repayment fee to their loans, so you’ll have to pay that fee if you want to get out of the credit builder loan. The other is that repaying the loan early somewhat defeats the purpose. Each monthly payment you make toward the loan helps you build your credit. If you pay the loan off early, you’ll make fewer monthly payments, which means less improvement in your credit.
Missing a payment on a credit builder loan is like missing a payment on any loan. You’ll likely owe a late fee and it will damage your credit. This is one of the reasons it’s important to make sure you can afford the monthly payment before signing up for a credit builder loan. If you can’t make your payments, the loan will wind up damaging your credit instead of helping it.
Credit builder loans can be a good way to build or rebuild your credit, but they’re not your only option. They often involve paying fees and interest, so you should search around for the best deal or look for cheaper (or free) alternatives, such as secured credit cards.
How to lower your credit card interest rate and save money
Why pay high interest on your credit cards when you can simply bargain a lower rate? These tips can help you save big money on your bill.
CHARLOTTE, N.C. — A lot of people have struggled to pay their bills during the COVID-19 pandemic and many have turned to credit cards so they can kick the can down the road. Now the time has come to pay it down and some of the bills are eye-popping.
Did you know you can bargain that interest rate down and save quite a bit of money?
You could ask for a lower rate, but according to a new study, you can bargain down 10 percentage points. So, if your interest rate is 24%, it could mean paying 14% instead. That’s still high but it’s a lot better than 24% interest.
These numbers are staggering and can be a bit overwhelming. Americans have an average credit card balance of $5,300, totaling $807 billion across 506 million credit card accounts. Why are these numbers important? Because they want to keep you spending, which means you have leverage to bargain.
“It is absolutely possible to negotiate your rate down. In fact, your chances of doing so are better than you think they are. Close to 80% surveyed said they did just that,” Matt Schultz, an industry expert with LendingTree, said. “You can save serious money, especially if your balance is bigger.”
You have to try, and you have to keep trying, even if the lender says no. Take it higher to a manager and keep pushing. Drops of 10% are possible and that could save you hundreds, or maybe even thousands, of dollars.
“So, a lot of people have bad credit, some are thankful to have it at all. Is it possible for them too? Yes, absolutely it’s possible,” Schultz said. “Credit card companies are willing to talk with you because they want to keep your business. It benefits them to lower your rate to keep their card in your wallet.”
Paying down debt is liberating. Less debt is more buying power but you must advocate for yourself. If you don’t, the card companies are just as happy to take your money at the higher rate.
LendingTree offers these suggestions if you plan to ask for a lower rate:
How to ask for a lower APR
Before you make the call, come armed with ammunition in the form of other offers you’ve seen at a site like LendingTree.com or that you may have received in your snail mail. Take that offer and use it to frame the conversation:
“I’ve been a good customer of yours for a long time and I like my card. However, the APR is 25% and I’ve just been offered one with a 19% APR. Would you be able to match it?”
As survey data shows, they’ll likely be willing to work with you, at least to some degree.
How to ask for a waived annual fee
Before you make the call, think about what you will accept. If you ask for a fee to be waived altogether and they only offer to reduce it, is that good enough? What if they offer you extra rewards points or miles or make some other counteroffer instead of a reduced fee? And perhaps most important, what if they say no?
As with many negotiations, you have more leverage if you’re willing to walk away, so that could be an option. However, you shouldn’t make that threat unless you’re willing to follow through with it, and you shouldn’t follow through with it unless you’ve thought about what that would mean for your credit.
How to ask for a waived late fee
Just pick up the phone and be polite. If you’re a long-time customer with good credit and this is your first offense, the odds are in your favor. In fact, some card issuers will even waive a first late fee as a matter of policy. If you’ve been late multiple times in the recent past, however, your chances probably aren’t as good. Even so, it never hurts to ask.
How to ask for a higher credit limit
Start with a number in mind based on your current limit. The average increase reported in our survey was about $1,500, but your situation will vary. If your current limit is $500, a $1,500 bump might be asking too much. However, if your current limit is $5,000, that request might be just fine.
Think about why you’re asking for the increase — for some extra spending power or to help your credit score — and then decide what to ask for. Just remember that it’s always better to start a negotiation by asking for a little too much. That way, when you negotiate, you can give a little bit and still get what you want.
Can A Moving Loan Help Your Relocation? Find Out Here – Forbes Advisor
Editorial Note: Forbes may earn a commission on sales made from partner links on this page, but that doesn’t affect our editors’ opinions or evaluations.
Whether you’re relocating to another city or state, moving can be expensive. You might need money to pay for a moving van or movers, new furniture or your security deposit. If you don’t have money on hand to cover those expenses, a moving loan can help you fill in the gap.
Before you take out a relocation loan, learn what they are and how to compare your options to understand if it’s a good choice for your situation.
What Is a Moving Loan?
A moving loan—also referred to as a relocation loan—is an unsecured personal loan you can use to help cover your moving expenses. Unsecured loans don’t require you to use a personal asset to secure the loan. Because the loan is unsecured, lenders base your eligibility on factors like your credit score, income and debt-to-income (DTI) ratio. Like with other types of personal loans, you’ll have to repay your loan through fixed monthly installments.
When Should You Get a Moving Loan?
Although the answer varies based on your financial circumstances, it may make sense to get a moving loan if you can secure a good interest rate and can afford to repay the loan as promised. However, if you believe it might be hard for you to repay the loan, then it’s probably a good idea to avoid taking one out. Falling behind on payments can damage your credit score, making it harder for you to qualify for future loans.
How to Get a Moving Loan
- Search for lenders: To find lenders that offer relocation loans, search for the best personal loans online. A good place to start might be a lender comparison website. While there, carefully review the terms, minimum credit score requirements, fees and annual percentage range (APR) range of each lender. In addition, you can check with your local bank or credit union to see if it offers personal loans for moving.
- Prequalify with multiple lenders: Once you narrow down your list of the best lenders, prequalify with each one of them (if available). This allows you to see what terms and APR you might receive if approved. Make sure the lender does a soft credit check to protect your credit score from any pitfalls.
- Determine the amount you need to borrow: Estimate your moving or relocation expenses to see how large of a loan you need to take out. Different lenders have different minimum loan amounts. Also, some states have rules about the minimum amount you can borrow, which may affect the size of your loan.
- Apply for your moving loan: After you select the lender that matches your needs, complete the application process. Prepare to provide the lender with personal information, such as your income, date of birth and Social Security number (SSN). Some lenders will require you to provide W2’s, pay stubs or bank statements to confirm your income.
- Wait for the lender to make a loan decision: After you apply, wait for the lender to review your application. Some lenders might approve you within seconds, while others may take longer. If a lender denies your loan, ask them for an explanation. Applying with a co-borrower or co-signer, improving your credit score, reviewing your credit report for errors or requesting a smaller amount may improve your chances of approval.
- Sign the loan agreement and receive funds: Once approved, the lender will send you a loan agreement to sign. After you sign the agreement, the lender will most likely deposit your funds directly into your account. The time of funding varies for different lenders—some lenders can issue the funds the same day while others may take a week or longer.
- Repay your loan: Finally, repay your loan as promised. Making late payments or defaulting on the loan can damage your credit score. Setting up autopay is one way to ensure you’ll never miss a payment.
Pros of Moving Loans
- Quick access to funds: If your loan application is approved, some lenders may deposit your funds into your bank account the same day or within a week.
- Flexible loan terms: Some lenders allow you to take out personal loans for moving with loan terms as short as 12 months and as long as 84 months. A long-term loan may have a lower minimum monthly payment, which might better suit your budget. However, the downside is that you’ll pay more in interest over the life of the loan.
- Lower interest rates than credit cards: The average interest rates for personal loans are usually lower than those for credit cards. If you have a good credit score (at least 670) and a stable income, you may be able to secure a good interest rate—an interest rate that’s lower than the national average.
- No collateral required: Since loans for moving typically require no collateral—an asset that secures the loan—you won’t have to worry about a lender taking your asset (at least without a court’s permission).
Cons of Moving Loans
- Fees: Some lenders charge origination fees between 1% and 8%—these fees can be a huge drawback since the lender usually subtracts them from your loan amount. Other common personal loan fees include application fees, returned check fees, late payment fees and prepayment fees.
- Potentially high interest rates: If you have less-than-stellar credit or minimal credit history, your lender may charge you high interest rates. Some lenders have APRs above 30%.
- Missed payments can damage your credit score: If you miss a payment or default on the loan, it can damage your credit score. This will make it more difficult for you to qualify for future loans.
Moving Loan Alternatives
If you want to avoid the potential cons of a relocation loan, consider these alternative options to help cover your moving expenses or rent.
0% APR Credit Card
Borrowers with good to excellent credit scores (at least 670) can avoid paying interest and high fees with a 0% APR credit card. These cards come with interest-free promotion periods, which can last for up to 21 months. If you pay off your balance before the promotion period expires, you won’t have to worry about paying interest. However, providers will charge interest on unpaid balances once the introductory period ends.
Family loans are another way to avoid paying interest or to pay minimal interest when it comes to your relocation expenses. With this option, you can also avoid the formal loan application process. The loan agreement between you and the family member should spell out the terms and conditions of the loan. Repay the loan as promised to avoid causing damage to your relationship.
Payday Alternative Loan
If you can’t qualify for a relocation loan or have trouble finding moving loans for bad credit, consider using a payday alternative loan. Some federal credit unions offer these loans, which are designed to help you avoid the high-interest charges of payday loans. You can borrow up to $2,000; loan terms range from one to 12 months and the maximum interest rate is 28%. To use this option, you must be a member of a federal credit union or be eligible for membership.
Instead of using a personal loan for moving, it might be better to use your savings, if possible. If you know how much it will cost, then create an automatic savings plan to cover most or all of your relocation expenses.
If you’re moving for a new job, ask your new employer if it will cover some of your relocation expenses. Some employers offer this to employees as an incentive to accept the job offer. Even if the employer doesn’t offer this, you can ask for a relocation bonus or try negotiating a higher salary.
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