China Merchants Bank has received an approval from the China Banking Regulatory Commission (CBRC) to sell a new round of asset-backed securities (ABS) backed by credit card debt.
The bank will start issuing credit card ABS within the next few months, Bai Yang, the general manager of the finance department at China Resources SZITIC Trust, told the South China Morning Post.
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SZITIC Trust, a subsidiary of CR Holdings, served as the lead underwriter for the bank’s credit ABS that was issued last year.
In November last year, CBRC recommended a total ban on credit ABS, but did not issue a formal statement on the ban.
"We have permission to start this again. The regulator has confidence in Merchants Bank for handling this kind of product," Yang added.
In April this year, the state council said that banks would no longer need to require regulatory approval to issue ABS but have to register the products and meet some requirements.
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By GlobalDataThe bank had issued CNY15.39bn credit card asset-backed securities as of March 2014.
