"Even at rock-bottom prices"? Another billion-yuan bank stock heading for auction, with multiple previous "zero transactions"

Recently, multiple large bank equity auctions have been repeatedly sold at a discount but still remain unsold.

A China Securities Journal reporter observed on Alibaba Judicial Auction Platform that several equity stakes worth over one billion yuan, including those of Jiujiang Bank and Guangdong Huaxing Bank, have been relisted after multiple failed auctions and have entered the liquidation process. Additionally, according to JD Asset Trading Platform, several more bank equity auctions exceeding one billion yuan have recently been “listed,” including approximately 223 million shares of Guangfa Bank held by Jiangsu Sugang Group, which will be auctioned in early April with a starting price of 784 million yuan—this is the highest single bank equity auction amount listed this year.

In the face of a sluggish auction market for non-listed bank equities, some entrusted parties are attempting to attract buyers through low-price promotions. Recently, a China Securities Journal reporter noticed that Alibaba Judicial Auction Platform listed 100,000 shares of Beijing Rural Commercial Bank with a starting price of only 188 yuan, while the bank’s latest net asset value for that equity is as high as 837,000 yuan.

Huge Bank Equity Auctions Remain Unsold

Recently, a China Securities Journal reporter found that Jiangxi Baosheng Industrial Co., Ltd. (referred to as “Jiangxi Baosheng”) has publicly listed 23.652 million shares of Jiujiang Bank’s domestic stock. Due to multiple previous failed auctions, it has now entered the liquidation process, with an estimated liquidation price of about 193 million yuan, or roughly 8.18 yuan per share. This is about four times the closing price of 1.85 Hong Kong dollars per share (approximately 1.63 yuan RMB) on March 6.

In fact, in October last year, Jiangxi Baosheng’s holdings of this stock were publicly listed again. The first auction had a starting price of 241.8 million yuan but attracted no bidders; the second round was reduced to 193 million yuan but still failed to find a buyer, resulting in a failed auction. As early as July to August 2021, several of Jiangxi Baosheng’s holdings of Jiujiang Bank shares (with a combined listing base price exceeding 100 million yuan) were forcibly auctioned by courts but did not succeed. Subsequently, during the second auction, the process was withdrawn.

Besides the auctioned shares of Jiujiang Bank, other bank equities that have undergone multiple auctions include those held by Shanghai Shenglong Investment Group in Guangdong Huaxing Bank. One of these holdings of 90 million shares was in liquidation in February but ended without bids, only to be relisted recently.

In fact, among judicially auctioned small and medium-sized banks, failed auctions are common. For example, in January this year, Zhongrong XinDa Group held about 416 million shares of Shanxi Bank, with a listing base price of 417 million yuan, which also failed to attract bids. In February, Tianjin Runsheng Plastic Products Co., Ltd. held 3.06 million shares of Langfang Bank, with a discounted price of 74.63 million yuan, but the auction still did not conclude during the second round.

On one side, many bank stocks have been waiting long-term for buyers in the auction market; on the other side, numerous newly listed bank equities are continuously being supplied, creating a clear imbalance between supply and demand.

A China Securities Journal reporter noted that on March 2, JD Asset Trading Platform showed that Jiangsu Sugang Group’s 223 million shares of Guangfa Bank were relisted with a starting price of 784 million yuan, scheduled to be auctioned starting April 2 this year. According to the valuation report, the total assessed value of these 223 million shares is 980 million yuan, or about 4.40 yuan per share. The court’s starting bid was reduced from the assessed value to 784 million yuan, or approximately 3.5 yuan per share, representing an 80% discount.

Another auction with a starting price exceeding 100 million yuan involves 30 million shares of Jiangsu Haian Rural Commercial Bank, with a low starting bid of 120 million yuan, about 30% below the assessed value.

“188 Yuan for 10,000 Shares” Has Become a Traffic-Driving Tactic

Similarly, due to low overall market transaction volume, some entrusted parties are attempting to attract attention through “low-price traffic” strategies in bank equity auctions.

Recently, a China Securities Journal reporter saw on Alibaba Asset Auction Platform that several Beijing Rural Commercial Bank equities are being or will be auctioned. One of these, 100,000 shares, has a starting price of only 188 yuan. However, the deposit for this auction is 20,000 yuan, with a minimum bid increment of 2,000 yuan. An entrusted staff member explained to the media that setting the starting price at 188 yuan is to attract participants, and the final transaction price will definitely be higher.

As of March 8, 21 people had registered for this equity, nearly 750 set reminders, and it attracted over 4,700 views. On March 5, another auction of 100,000 shares of Beijing Rural Commercial Bank with a starting price of 1,888 yuan was completed after 70 bids, closing at 388,800 yuan.

The auction notice shows that as of the end of September 2025, Beijing Rural Commercial Bank’s net asset value per share was 8.37 yuan. Compared to 2024, the value of the bank’s equity increased, with the year-end net asset per share at 7.49 yuan. Additionally, according to the bank’s 2024 dividend payout in June last year, the cash dividend per share was 0.14 yuan (tax included). For 10,000 shares, this amounts to 14,000 yuan in pre-tax income just from dividends.

Liquidity for Non-Listed Bank Equity Is Cold

For small and medium-sized banks with frequent equity auctions, the liquidity of non-listed bank equities remains poor, making it difficult to complete transactions through auctions. Industry analysts pointed out that among the small and medium-sized bank equities forcibly auctioned on judicial platforms, what proportion actually get sold? Based on incomplete statistics from China Securities Journal, as of the end of 2025, there have been 2,700 bank equity auction cases on Alibaba’s judicial auction platform, with only 650 resulting in successful transactions. The remaining 2,050 cases ended in no bids and failed to sell.

This means that over 75% of the bank equity listings on this platform in 2025 failed to complete transactions, a significant increase compared to previous years. Geographically, the success rate varies, with more active markets in economically developed regions like the Pearl River Delta and Yangtze River Delta, while smaller banks in central, western, northern, and northeastern China see less activity.

According to data from the National Financial Regulatory Administration, by the end of 2025, China’s commercial banks’ net interest margin further narrowed to 1.42%, down 10 basis points from the end of Q4 2024. Non-performing loan ratios remained flat at 1.50% year-over-year. In terms of institution types, city commercial banks saw a relatively higher increase in non-performing loans, rising by 0.06 percentage points.

Faced with operational risks, CTF Securities analyst Sun Binbin’s team previously pointed out that the primary risks for small and medium-sized banks include internal control compliance issues, illegal operations, and risks related to shareholders and actual controllers in the equity structure. Additionally, during economic recovery and the transition of new and old driving forces, the operational risks for these banks increase. Meanwhile, in a low-interest-rate environment, narrowing interest margins reduce profitability, affecting capital adequacy and solvency.

“In the short term, the market for small and medium-sized bank equity auctions will continue to be cold, likely characterized by ‘deep discounts and shrinking transactions,’” said Bai Wenxi, Vice Chairman of the China Enterprise Capital Alliance. He believes that the “winter” of small and medium-sized bank equity auctions is a concentrated release of risks accumulated from past extensive growth models. The key to breaking this cycle is not waiting for market recovery but through substantive risk clearance, governance restructuring, and mechanism innovation to restore investment value in small and medium-sized bank equities.

Typeset by: Wang Lulu

Proofread by: Wang Jincheng