BEIJING (Reuters) - China Construction Bank Corp (CCB), the country's second-largest commercial lender, said on Friday it has received regulatory approval to set up a subsidiary to conduct market-driven debt-for-equity swaps.
CCB was the first among Chinese banks to get approval from the China Banking Regulatory Commission to open such a subsidiary, it said in an online statement.
The new unit, called CCB Financial Asset Investment Co, has a registered capital of 12 billion yuan ($1.77 billion) and is wholly owned by the bank, it said.
Since China's policymakers re-launched the debt-for-equity scheme in October last year to ease the borrowing overhang of its struggling firms, the country's top banks have rushed to sign deals with state-owned enterprises to ease their burden.
CCB has been the leading player in signing such deals, accounting for 50 percent of market share, it said.
As of July 20, CCB has signed 544.2 billion yuan worth of debt-for-equity swap agreements with 41 enterprises, according to the statement. Among the deals, it has invested 45.4 billion yuan in nine companies.
Reporting by Shu Zhang and Ryan Woo; Editing by Sunil Nair