Tian­jin be­comes cen­ter for fi­nan­cial leasing

China Daily (USA) - - BUSINESS - By JIANG XUEQING in Beijing and ZHANG MIN in Tian­jin

ICBC Fi­nan­cial Leasing Co Ltd, the largest fi­nan­cial leasing com­pany by assets in Tian­jin and es­tab­lished in 2007, will con­tinue to strengthen its ef­forts to in­no­vate in the field of fi­nan­cial leasing.

The com­pany helped Ningbo Meis­han-Island In­ter­na­tional Con­tainer Ter­mi­nal Co Ltd to pur­chase equip­ment from other coun­tries and took in­no­va­tive mea­sures to re­duce taxes for the com­pany in Sept 2015.

“This is done by duty-free leasing, a new type of leasing pos­si­ble be­tween com­pa­nies in duty-free zones,” said Tao Mei, vice-pres­i­dent of ICBC Fi­nan­cial Leasing.

“We set up a spe­cial pur­pose ve­hi­cle (that is, a sub­sidiary of a com­pany which is cre­ated for only a spe­cific use and is bankruptcy re­mote in the sense that it is not on the books of the main or­ga­ni­za­tion) in Dongjiang Free Trade Port Zone of Tian­jin. Ningbo Meis­han-Island is lo­cated in an­other lo­cal free trade zone. As a re­sult, the com­pany ben­e­fits from tax re­lief, with a re­duc­tion of at least 17 per­cent of the value-added tax,” Tao added.

Tian­jin has de­vel­oped into an in­no­va­tive base for China’s fi­nan­cial leasing in­dus­try, ac­cord­ing to fi­nan­cial leasing com­pany ex­ec­u­tives and lo­cal govern­ment of­fi­cials.

to­tal assets of fi­nan­cial leasing com­pa­nies reg­is­tered in Tian­jin at the end of March

Ear­lier this year, CMB Fi­nan­cial Leasing paid $200 mil­lion for a sale and lease­back busi­ness in for­eign cur­ren­cies, which is the first of its kind na­tion­wide.

“It will help cut ex­change rate losses for the lessee and save fi­nan­cial costs by more than $2 mil­lion each year,” said Zhou Ling, general man­ager of the ship­ping leasing de­part­ment of CMBFi­nan­cial Leasing.

At the end of March, to­tal assets of fi­nan­cial leasing com­pa­nies reg­is­tered in Tian­jin reached more than 770 bil­lion yuan ($116 bil­lion), ac­count­ing for around a quar­ter of the to­tal amount na­tion­wide.

“Tian­jin is the first in China to im­ple­ment dozens of in­no­va­tive ser­vice mod­els, in­clud­ing duty-free leasing, cross­bor­der leasing and off­shore leasing,” said Kong Dechang, di­rec­tor of Tian­jin Mu­nic­i­pal Bureau of Fi­nan­cial Af­fairs.

As the most im­por­tant area of the fi­nan­cial leasing in­dus­try in Tian­jin, Dongjiang Free Trade Port Zone fea­tures leasing ser­vices for air­craft, ships and ocean en­gi­neer­ing equip­ment. At the end of June, the to­tal leasing assets re­lated to the three main busi­ness ar­eas reached $40 bil­lion.

Tian­jin will fur­ther ac­cel­er­ate in­no­va­tion to boost the growth of fi­nan­cial leasing. The city is plan­ning to launchChina Tian­jin Leasing Plat­form and China Fi­nan­cial Leasing Reg­is­ter and Trans­fer Plat­form, which are wait­ing for ap­proval by the State Coun­cil.

“Aim­ing to sup­port the de­vel­op­ment of the fi­nan­cial leasing in­dus­try, the two plat­forms will be open to all fi­nan­cial leasing com­pa­nies na­tion­wide. They will of­fer reg­is­tra­tion and trans­fer­ring ser­vices for fi­nan­cial leasing assets worth a to­tal of 4 tril­lion yuan,” said Zhang Aiguo, di­rec­tor of Tian­jin Com­mis­sion of Com­merce. Wang Ying this story. con­trib­uted to

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