CHINA VANKE (000002.SZ) announced on the evening of October 30 that its largest shareholder, Shenzhen Metro Group, has agreed to provide a loan of up to RMB 2.2 billion to the company. The funds will be used to repay principal and interest on bonds issued by VANKE in the public market, with a loan term not exceeding three years.

As of now, Shenzhen Metro Group holds a 27.18% stake in VANKE, making it an affiliated party under the Shenzhen Stock Exchange listing rules. The transaction qualifies as a connected transaction but does not constitute a major asset restructuring or backdoor listing under regulatory guidelines, thus requiring no additional approvals.

**Favorable Loan Terms** The loan interest rate follows market principles and is lower than VANKE’s current borrowing costs from financial institutions, reflecting strong support from its major shareholder. The company confirmed that the transaction does not harm the interests of minority shareholders and will not adversely impact its financial condition or operating performance.

Since early 2025, VANKE and Shenzhen Metro Group have engaged in two other connected transactions: 1. On January 27, 2025, VANKE transferred its investment returns and related assets in the Hongshuwan property development project to Shenzhen Metro Group. 2. Shenzhen Metro Group has extended cumulative loans totaling RMB 26.93 billion (excluding the latest loan), including multiple tranches approved by VANKE’s board and shareholders.

**Q3 Financial Performance** VANKE reported a Q3 2025 revenue of RMB 56.07 billion but recorded a net loss attributable to shareholders of RMB 16.07 billion. The loss was attributed to declining property development revenue, low gross margins, additional inventory impairment provisions, and asset disposals below book value.

For the first nine months of 2025, VANKE’s revenue stood at RMB 161.39 billion, with a net loss of RMB 28.02 billion. The company acknowledged ongoing operational challenges, including sustained sales declines and liquidity pressures.

**Operational Highlights** - Delivered 74,000 homes in Q1-Q3 2025 while enhancing service quality. - Achieved sales of RMB 100.46 billion and completed 19 bulk asset transactions worth RMB 6.86 billion. - Optimized RMB 17.84 billion in existing assets, including the divestment of its winter sports business to China Travel Group.

**Financing and Debt Management** Excluding shareholder loans, VANKE raised RMB 26.5 billion in new and refinanced debt in 2025, with an average domestic financing cost of 3.44%, down 6 basis points year-on-year. Shenzhen Metro Group has now provided RMB 29.13 billion in loans to VANKE under favorable terms.

As of the announcement date, VANKE has repaid RMB 28.89 billion in public debt. The company is also streamlining its organizational structure to align with strategic goals.

**Impairment Provisions** In Q3 2025, VANKE recorded impairment provisions totaling RMB 9.368 billion, reversing RMB 1.7 billion, resulting in an RMB 8.309 billion reduction in net profit attributable to shareholders.

VANKE’s shares closed at RMB 6.27 on October 30, with a market capitalization of RMB 74.806 billion.