A block of internal employee shares from Hangzhou United Rural Commercial Bank Co., Ltd. (hereinafter referred to as "Hangzhou United Bank") was recently successfully auctioned on the Alibaba Judicial Auction platform.
The auction concluded after multiple rounds of bidding, with a final transaction price of 1.113 million yuan, representing a discount of approximately 8.5% to the appraised value. The sale attracted 9 registered bidders who placed a total of 83 bids, forming a stark contrast to the repeated failed auctions of over 30 million shares of the bank previously.
The pricing of internal employee shares, which are restricted in transferability and exhibit weak liquidity, often requires a comprehensive evaluation of the bank's future growth prospects and its current realizable value. Liao Hekai, an analyst at Jinle Function, stated that this transaction reflects market recognition of Hangzhou United Bank's intrinsic value and also indicates that the auction market for shares of small and medium-sized banks is gradually maturing, with pricing becoming increasingly rational.
The final transaction price was 1.113 million yuan. Information from the Alibaba Auction platform shows that the subject of the auction was 136,517 internal employee shares of Hangzhou United Rural Commercial Bank Co., Ltd., held by a natural person. The starting price was set at 855,000 yuan. The auction officially commenced on January 4, 2026, and concluded after multiple rounds of bidding, reaching a final price of 1.113 million yuan. Compared to the appraised value, the final price represented a discount of about 8.5%.
In terms of the bidding process, although the lot was not large in size, it attracted considerable attention. Platform data indicated that the auction drew 9 registered participants, who collectively placed 83 bids, triggering 68 extensions. A total of 402 people set reminders for the auction, and it garnered 52,818 views.
Internal employee shares refer to shares legally allocated by a commercial bank to its current employees, fundamentally different from ordinary shares that can be freely traded on the open market. While these shares confer ownership rights, their transfer and circulation are subject to significant institutional constraints and regulatory restrictions.
It is understood that the potential buyers for internal employee shares are limited,原则上 restricted to qualified internal bank employees or specific entities, and cannot be arbitrarily sold to the general public. The transfer process is relatively complex, often requiring approval from the bank's board of directors, shareholders' meeting, and regulatory authorities. Furthermore, during periods when the bank is pursuing an IPO or other capital operations, such shares may be subject to lock-up arrangements for a certain period. Additionally, the pricing of employee shares and the qualifications of the transferees must comply with regulatory stipulations and necessary information disclosure obligations.
Consequently, compared to ordinary shares, internal employee shares exhibit significantly weaker liquidity in actual transactions. Market pricing for such shares often relies more heavily on a comprehensive assessment of the bank's future growth expectations and its current realizable value, rather than solely on book value or public market prices.
Liao Hekai, an analyst at Jinle Function, pointed out in an interview, "The starting price was set at 855,000 yuan, approximately 70.2% of the appraised value. This level of discount is relatively common in auction markets and helps attract potential buyers to participate in the bidding."
Liao Hekai analyzed that the discount of the starting price relative to the appraised value stemmed mainly from two factors. First, internal employee shares inherently have low liquidity; in the absence of public trading channels and with restrictions on eligible buyers, a price concession is necessary to enhance the likelihood of a successful transaction. Second, the appraised value typically incorporates expectations for the bank's future operations and growth, whereas the starting price focuses more on the current realizable value. This discrepancy is particularly evident in equity transactions subject to strong institutional constraints.
He also noted that compared to large blocks of corporate shares, small employee share lots, while lowering the capital threshold, are not necessarily easier to transact due to constraints such as transfer approvals and the limited pool of eligible buyers. The successful auction of this particular lot is related both to the reasonably set starting price and, to some extent, reflects market recognition of Hangzhou United Bank's intrinsic value.
The auction market for shares of small and medium-sized banks is gradually maturing. Notably, since initiating its IPO辅导 in 2017, shares of Hangzhou United Bank have frequently appeared on judicial auction platforms, predominantly consisting of medium to large blocks of corporate shares. Public information shows that in August 2024, a block of 31.993 million shares of the bank was listed for auction on the Alibaba Judicial Auction platform with a starting price of 256 million yuan, following two previous failed auctions with starting prices of 313 million yuan and 282 million yuan, respectively.
Liao Hekai stated that the successful auction of Hangzhou United Bank's internal employee shares is not accidental but reflects market recognition of the bank's value. It also indicates, to some extent, that the auction market for shares of small and medium-sized banks is gradually maturing. From the perspective of the price formation mechanism, the final transaction price, although slightly below the appraised value, was significantly higher than the starting price, demonstrating rational pricing formed by the market for this type of equity characterized by liquidity constraints and institutional limitations.
Liao Hekai believes that this transaction price holds certain reference value for subsequent auctions of similar assets but should not be simplistically regarded as a price benchmark. If similar internal employee shares or other small-sized bank equity lots can achieve transactions consistently in the future, it would more strongly validate the market's recognition of Hangzhou United Bank's overall value.
Hangzhou United Bank's predecessor was Hangzhou United Rural Cooperative Bank, established in June 2005. It was restructured from the original United Association of Rural Credit Cooperatives in Hangzhou urban area and its affiliated rural credit cooperatives. It was established as a shareholding cooperative bank with investments from farmers, rural businesses, corporate legal persons, and other economic organizations. At its inception, its paid-in capital was 513 million yuan.
In early 2011, the bank was transformed from a shareholding cooperative bank into a joint-stock commercial bank and renamed "Hangzhou United Rural Commercial Bank Co., Ltd.". From 2011 to 2020, the bank increased its capital through profit distribution for ten consecutive years. As of the end of 2024, the bank's registered capital stood at 2.18 billion yuan. As of the end of June 2025, the bank operated 138 branches and had initiated the establishment of 14 village banks in total.
As of the end of June 2025, Hangzhou United Bank had total assets of 591.190 billion yuan, net loans and advances of 338.676 billion yuan, and total customer deposits of 427.086 billion yuan. In the first half of 2025, it achieved operating revenue of 6.146 billion yuan and net profit attributable to the parent company's shareholders of 2.505 billion yuan. Its return on assets was 0.93%, and its return on equity was 12.56%. As of the end of June 2025, its non-performing loan ratio was 0.91%, the loan provision ratio reached 3.90%, and the provision coverage ratio stood at 426.15%.
Comments