The north-eastern Chinese province of Liaoning is set to welcome a new rural commercial bank via the merger of 30 regional rural credit unions with a leading municipal rural lender.
According to an official announcement published by the Liaoning Daily on 26 November, the Liaoning Province Rural Village Commercial Bank (辽宁省农村商业银行股份有限公司) will be formed by the merger of Shenyang Rural Village Commercial Bank (沈阳农村商业银行股份有限公司) with 30 rural credit unions in the province.
Following its establishment, Liaoning Rural will take over all creditor’s rights and debts of both Shenyang Rural and the 30 rural credit unions involved in its launch.
The announcement said Shenyang Rural had already given its approval and authorisation to launch a work team for preparations to establish Liaoning Rural, which would include enlisting intermediary organisations to engage in assets verification and evaluation, as well as disposal net assets and other work.
Shenyang Rural has already completed internal corporate governance procedures with each of the 30 rural credit unions involved, and reviewed and approved related resolutions.
The move comes following a wave of mergers and consolidation in China’s regional banking sector, in order to shore up the health of smaller scale lenders subject to less stringent controls than the large-scale lenders.
In April the Zhejiang province branch of the China Banking and Insurance Regulatory Commission (CBIRC) gave its approval for Zhejiang Rural Village Commercial United Bank (浙江农村商业联合银行股份有限公司) to commence operation, taking over the creditor’s rights and debts of Zhejiang Rural Village Credit Union United (浙江省农村信用社联合社).