[Hong Kong, October 17, 2022] – SY Holdings Group Limited ("SY Holdings" or the "Group"; Stock Code: 6069.HK) has successfully completed the first tranche issuance of its "N+N+N" shelf ABS program - "CMB Securities-SY Technology Phase 1 Asset-Backed Special Plan" on the Shenzhen Stock Exchange. With a total shelf registration size of RMB 3 billion, this initial issuance amounted to RMB 200 million with a 2-year tenor. The senior tranche of RMB 180 million received an AAA rating from China Chengxin International Credit Rating and achieved a record-low coupon rate of 2.9% for both pharmaceutical ABS and factoring asset ABS of similar tenors in the Yangtze River Delta region, attracting strong investor demand with an oversubscription rate of 1.97 times.
The transaction features Wuxi Guojin Commercial Factoring Co., Ltd., a joint venture between Sheng Ye and Wuxi Communications Industry Group, as the originator, with AAA-rated Wuxi Communications Industry Group serving as the deficiency payor. SY Information Technology Services (Shenzhen) Co., Ltd., a fully owned subsidiary, provided technological support. The underlying assets consist of receivables from state-owned pharmaceutical distributors to public hospitals (Grade II and above), demonstrating strong credit quality and economic cycle resilience.
This marks Sheng Ye's second successful pharmaceutical ABS issuance, following its 2018 debut "SX Securities-Sheng Ye Factoring Pharmaceutical Assets Phase 1 ABS" where Sheng Ye Commercial Factoring served as originator. These programs effectively monetize quality receivables in the pharmaceutical supply chain while addressing financing needs of medical distributors.
As a leading supply chain technology platform, Sheng Ye has developed a distinctive asset securitization model through years of industry specialization. This program demonstrates five key innovations:
1. Enhanced Inclusivity: Approved by the Shenzhen Stock Exchange on July 9, 2022, the "N+N+N" structure accommodates multiple factoring companies, core enterprises, and credit enhancers - a breakthrough from traditional "1+N" models. This platform strategy diversifies asset sources while delivering cost-efficient financial services.
2. Strong Credit Support: Participation from AAA-rated state-owned enterprises like Wuxi Communications Industry Group validates Sheng Ye's capabilities in asset sourcing, management, and securitization.
3. Sector Specialization: The program exclusively includes assets from infrastructure and pharmaceutical distribution - sectors with strong policy support and economic resilience where Sheng Ye possesses deep expertise.
4. Structural Optimization: Building on previous ABS experience, this iteration introduces multiple innovations including receivable pooling from various factoring companies, non-confirmation mechanisms for hospital payables, and flexible repurchase structures tailored to industry characteristics.
5. Scalability: The model allows participation from financial institutions and factoring companies with similar assets, with Sheng Ye providing end-to-end securitization services including asset screening, risk control, documentation preparation, and ongoing management. Several SOE factoring companies have already expressed intent to join future issuances.
For state-owned factoring companies, participating in SY's innovative "N+N+N" shelf-ABS program presents a strategic opportunity to capitalize on the current low-cost financing window for SOEs. This model significantly reduces issuance timelines and costs while minimizing underwriting uncertainties, simultaneously enabling asset diversification and flexible off-balance-sheet treatment. Currently, multiple central and local state-owned factoring enterprises have established cooperation agreements with SY and will participate in upcoming issuances under this program.
Moving forward, SY will continue enhancing its platform capabilities, leveraging technology to advance supply chain securitization while strengthening partnerships across the ecosystem to address financing challenges for SMEs.
