China Development Bank (CDB) will supervise aviation-to-financial services conglomerate HNA Group as it looks to shed the bulk of its assets amid a liquidity crunch.
CDB, HNA’s biggest creditor, sent a team to the company’s headquarters earlier this year, sources told Reuters, and is responsible for monitoring the trimming down of HNA’s highly-leveraged portfolio. The bank is not involved with conducting sale negotiations, the sources added.
HNA has claimed that it was looking to refocus on its core aviation business, but this has also been under recent strain. Last month, the firm’s main domestic airline, Hainan Airlines, sought a Rmb7.5 billion ($1.09 billion) loan from CDB.
“It looks like the regulators have gone beyond simply cutting back HNA’s assets and are maybe moving toward complete dissolution of the company but they have yet to declare that as the official policy,” said Andrew Collier, managing director of Orient Capital Research.