"Breaking bones" no one wants? Several billion-dollar bank stocks are about to be auctioned off, after multiple "zero transactions" before.

Recently, multiple large bank equity auctions have failed to attract bidders despite multiple discounts.

Brokerage China reporters 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 re-listed after multiple failed auctions and have entered the liquidation process. 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.

Faced with a sluggish auction market for non-listed bank equities, some trustees are attempting to attract buyers with low-price promotions. Recently, brokerage China reporters noticed that Alibaba Judicial Auction Platform listed 100,000 shares of Beijing Rural Commercial Bank with a starting price of only 188 yuan, even though the bank’s latest net asset value for that equity is as high as 837,000 yuan.

Huge bank equity auctions go unbid

Recently, brokerage China reporters noted that Jiangxi Baosheng Industrial Co., Ltd. (hereafter “Jiangxi Baosheng”) has publicly listed 23.652 million shares of Jiujiang Bank’s domestic stock, which, after multiple failed previous auctions, has now entered liquidation with an estimated sale price of about 193 million yuan, roughly 8.18 yuan per share. This is about four times the closing price of 1.85 HKD (approximately 1.63 RMB) per share on March 6.

In fact, last October, Jiangxi Baosheng’s holdings of this stock were publicly listed again, with the first auction starting at 241.8 million yuan but attracting no bids. The second round lowered the starting price 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 in Jiujiang Bank (with a combined listing base price exceeding 100 million yuan) were forcibly auctioned by courts but did not succeed, and subsequent second auctions were withdrawn.

In addition to Jiujiang Bank shares, other assets that have undergone multiple auctions include several holdings of Guangdong Huaxing Bank by Shanghai Shenglong Investment Group. For example, in February, 90 million shares of Guangdong Huaxing Bank were in liquidation but remained unsold until recently when they were re-listed.

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 30.6 million shares of Langfang Bank, with a discounted price of 74.63 million yuan, but the second auction phase also failed to sell.

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 stocks are continuously being supplied, creating a clear supply-demand imbalance.

Brokerage China reporters noted that on March 2, JD Asset Trading Platform showed that Jiangsu Sugang Group’s 223 million shares of Guangfa Bank, with a starting price of 784 million yuan, were “listed anew.” This large asset will 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-set starting price, based on the valuation, was reduced to 784 million yuan, approximately 3.5 yuan per share, representing a 20% discount.

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

“188 yuan for 10,000 shares” has become a promotional tool

Similarly, due to low overall market transaction volume, some trustees are using “low-price attraction” strategies for bank equity auctions.

Recently, brokerage China reporters saw on Alibaba Asset Auction Platform that several Beijing Rural Commercial Bank equities are being or will be auctioned. One lot of 100,000 shares has a starting price of only 188 yuan. However, the deposit for this lot is 20,000 yuan, with a minimum increment of 2,000 yuan. An official involved explained that the 188 yuan starting price is meant to attract participants, and the final transaction price will definitely be higher.

As of March 8, 21 people had registered for this auction, 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, in its 2024 dividend payout last June, the bank paid a cash dividend of 0.14 yuan per share (tax included). For 100,000 shares, this amounts to a pre-tax income of 14,000 yuan just from dividends.

Liquidity issues for non-listed bank equities

For small and medium-sized banks with frequent auction failures, the liquidity of non-listed bank equities in the auction market remains poor, making transactions difficult. Industry analysts point out:

Among the small and medium-sized bank equities forcibly auctioned on judicial platforms, what proportion actually transact? Based on incomplete statistics from brokerage China, as of the end of 2025, there have been 2,700 bank equity auction cases on Alibaba’s platform, with only 650 resulting in successful transactions. The remaining 2,050 cases ended in no bids and failed.

This means that over 75% of 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 economically developed regions like the Pearl River Delta and Yangtze River Delta performing better than central and western regions, North China, and Northeast China.

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, while non-performing loan ratios remained steady at 1.50%. Among different types of institutions, city commercial banks saw a relatively higher increase in non-performing loans, rising by 0.06 percentage points.

Facing operational risks, CITIC Securities analyst Sun Binbin’s team previously pointed out that small and medium-sized banks primarily face risks related to internal control compliance and illegal operations, as well as risks from shareholders and actual controllers in their equity structures. Additionally, during economic recovery and the transition of new and old growth drivers, these banks face increased operational risks; meanwhile, in a low-interest-rate environment, narrowing interest margins reduce profitability, impacting 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 ‘deepening 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 result of the risks accumulated during the previous extensive growth model. The key to breaking this deadlock is not waiting for market recovery but through substantive risk cleanup, governance restructuring, and mechanism innovation to restore investment value to these equities.