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Fujian Smart Manufacturing Will Receive the Financial Support of RMB 100 Billion From Industrial Bank

“During the 13th Five-Year Planning period, Industrial Bank (IB) will grant funds worth RMB 100 billion to support the smart manufacturing in Fujian, so as to boost the transformation, upgrading and development of manufacturing across the province.”

On August 27, IB held the “Introduction Meeting of Financial Services for Fujian Smart Manufacturing” in Quanzhou. When introducing the overall strategic deployment and long-run planning of the Bank for supporting the development of smart manufacturing, Vice President Lin Zhangyi of IB gave the above statement, and he also indicated “the manufacturing is the main body of national economy and smart manufacturing is an important service target of IB in the future”. 

On that day, representatives from the Financial Service Office, Development and Reform Commission, Commission of Economy and Information Technology and Department of Finance of Fujian Province, and government agencies of prefecture-level cities of the province, as well as 52 representative entrepreneurs across the province attended the meeting. During the meeting, the 9 Level 1 branches of IB in the province entered into the “Bank-enterprise Strategic Cooperation Framework Agreement” with corporate customers in strategic cooperation with the Bank in the area of smart manufacturing, planning to deepen cooperation in businesses in an all-sided manner.

Witnessing an amount of industrial added value hitting RMB 1,042.7 billion in 2014, Fujian is striding toward a large manufacturing province. At the meeting, Zhang Jinzhu, Director of the Financial Service Office of Fujian Province introduced, to make the leading industries bigger and stronger, transform and elevate the conventional industries, and foster and develop emerging industries, Fujian Provincial CPC Committee and Fujian Provincial People’s Government enacted policy guidelines and action programs, such as the “Opinions on Further Speeding up Transformation and Upgrading of Industries” and the “Action Plan of Fujian Province to Implement ‘Made in China 2025’”, in succession in July 2015, with a view to building platforms and upgrading Fujian industries by way of supporting leading enterprises, casting industrial chains and establishing industrial clusters. Yan Xiaodong, Deputy Director of Fujian Provincial Commission of Economy and Information Technology also gave an all-round interpretation to relevant policies, including the “Circular of Fujian Provincial People’s Government on the Nine Measures for Speeding up the Development of Smart Manufacturing” (Min Zheng [2015] No. 36), which are of general concern to enterprises engaging in manufacturing and application transformation of smart equipment in the province.

As the only national joint-stock commercial bank based in Fujian, IB has always taken root in the province and lent full support for the scientific and leaping development of the province. Now the Bank has, based on research, issued the action plan for supporting the development of smart manufacturing in Fujian Province, which centers on the four main directions, “NC Generation”, “Smart Equipment”, “Replacement of Workers with Machines”, and “Smart Service”, focuses on the two key areas, “smart equipment manufacturing” and “popularization of smart equipment application”, targets at the four corporate customer groups of “smart equipment manufacturing, smart transformation of conventional industries, development of smart system and software, and construction of industrial parks for smart equipment”, and provides differentiated financial services according to the features and demands of different types of corporate customers. Specifically, the plan includes:

An additional amount of funds totaling RMB 70 billion for supporting enterprises in the smart equipment manufacturing. In allusion to the needs of enterprises to increase their market shares, the Bank will provide financial products which can expedite the recovery of sales payment, such as accounts receivable pledging and domestic factoring, handle direct trade financing services for enterprises such as order financing and letter of credit, and offer financing lease products like vendor lease. Considering the needs of enterprises for import and export financing, the Bank will offer such services as import letter of credit, forfaiting and packaged loan. For the tendency that fast-developing enterprises get listed on the New OTC Bulletin Board, the Bank will provide a range of financial services covering industrial fund, OTC loan, new OTC equity pledge financing, and investment-based joint loan.

An additional amount of funds totaling RMB 20 billion for supporting enterprises in the smart transformation of conventional industries. Key support will be given for projects of enterprises in the conventional industries where they employ digital control technology and smart equipment to make automation and smart technology based transformation and upgrading to conventional production facilities, and projects for transforming monitoring systems to improve the digital-controlled and smart management level of conventional industries. The Bank will provide such services as fixed assets loan, direct equipment financing lease, and sale-leaseback of equipment, and considering the needs of enterprises for vitalizing assets, it will provide them with such financial services as corporate assets securitization, group bill pool and perpetual debt.

An additional amount of funds totaling RMB 5 billion for supporting enterprises engaging in the development of smart system and software. Targeting at SMEs of high growth potential in light-asset operation which have independent intellectual property rights (IPR), the Bank will, centering on the characteristics of software service enterprises, make vigorous efforts to develop internet finance, intensify the promotion of IPR pledge based financing products and offer convenient products such as “e-series” for small-sized enterprises, online financing products and internet supply chain finance.

An additional amount of funds totaling RMB 5 billion for supporting enterprises engaging in the construction of industrial parks for smart equipment. In allusion to the needs of infrastructure construction of industrial parks for smart equipment, the Bank will actively promote long- and medium-term financing products such as industrial fund, PPP-style project financing, and infrastructure construction loan as well as financial lease products for sale-leaseback of fixed assets, to provide supporting service for construction of ancillary facilities of such industrial parks.

“We will give priority to arranging RMB 20 billion as the line of special resource risk assets for ‘smart manufacturing’ customers or projects, and establish a green approval channel providing fast acceptance and prior approval service.” Zhou Wei, General Manager of Corporate Finance Marketing Management Department of IB, told the reporter that, in regions with active economic activities, characteristic industries with outstanding advantages, and a high “digital-controlled level”, the Bank plans to establish specialized institutions and characteristic industrial centers to carry out specialized and centralized business operation. Now the Bank has preliminarily classified and screened out 114 potential customers in the smart manufacturing and 1222 customers with the intention of smart equipment based upgrading and transformation across the province.  

As one of the few banking holding groups with multiple financial licenses such as banking, trust, lease, fund, futures, and assets management in China, IB will bring into full play its integrated and group-based advantages to support the smart manufacturing in Fujian. It is reported that Industrial Financial Leasing Co., Ltd., a solely-invested subsidiary of the Bank, has established a special business division for smart equipment, and signed the letter of cooperation intent with the Administrative Committee of Pingtan Comprehensive Pilot Zone, planning to make preparation for the establishment of a professional leasing company for smart equipment at the provincial level in Fujian.

Meanwhile, IB will also continue intensifying its efforts in banking-government business cooperation, study to establish a risk compensation mechanism for smart manufacturing, advance the establishment of a mechanism for the circulation of usufruct to leased assets, and participate in the government-supported equity investment fund for smart equipment manufacturing, thus boosting the transformation of Fujian manufacturing to “smart” manufacturing.