GRCB proposes substantial disposal of non-performing assets

Guangzhou Rural Commercial Bank (GRCB) announced a proposed very substantial disposal of non-performing assets, consisting of debt assets totaling approximately RMB18.928 bn as of June 30, 2025. The transaction, approved by the board on October 9, 2025, involves a conditional agreement to dispose of these assets and is subject to shareholder approval at an extraordinary general meeting. The unaudited book value of the disposal assets as of June 30, 2025, was approximately RMB12.132 bn, with an expected initial minimum consideration of RMB12.2 bn.

The disposal aims to optimize GRCB's asset structure, enhance risk resilience, and improve operating efficiency. The net loss (after tax) of the disposal assets was approximately RMB381m in 2023 and RMB795m in 2024. The proceeds, estimated at RMB12.2 bn, are intended for the bank's general working capital. The transaction will be conducted through a public tender process on an Equity Exchange, in compliance with Chinese regulations for bulk transfers of non-performing assets.

The proposed disposal is classified as a very substantial disposal under Chapter 14 of the Listing Rules, as aggregated percentage ratios are expected to exceed 75%. Shareholders are advised to exercise caution as terms are not yet finalized.