china targets a 3 trillion shadow banking industry
Last Updated : GMT 06:49:16
Arab Today, arab today
Arab Today, arab today
Last Updated : GMT 06:49:16
Arab Today, arab today

China targets a $3 trillion shadow banking industry

Arab Today, arab today

Arab Today, arab today China targets a $3 trillion shadow banking industry

China targets a $3 trillion shadow banking industry
Shanghai - Arab Today

As a flood of unregulated cash swirls through the Chinese economy, Beijing has been taking aim at the trust companies whose unrestrained lending practices are worrying regulators.
The trusts, at the heart of a vast shadow banking industry, are being pressured to step up compliance and background checks, and are being pushed toward greater transparency.
But the fast-growing 20 trillion yuan (SR11.63 trillion) industry, whose lending operations are cloaked behind opaque structures, will be tough to rein in, according to employees at some trusts.
A regulatory sanction against one trust, Shanghai International Trust, and a legal case against another, National Trust, offer rare insights into the industry, and reveals just how hard it will be to police it.
Shanghai Trust was fined 200,000 yuan for selling a product that violated leverage rules, according to a regulator’s notice in January. Regulators provided no further details about the case. Under these rules, property developers are only allowed to borrow up to three times their existing net assets.
According to two people with direct knowledge of the case, an unknown sum was loaned by China Construction Bank through Shanghai Trust to Cinda Asset Management Company. Cinda then invested the cash.
One of the sources said Cinda used the cash to acquire land, a sector rife with speculation that regulators have singled out as a “risky” destination for trust company loans. The source provided no further details.
Shanghai Trust, Cinda, CCB and the China Banking Regulatory Commission (CBRC) declined to comment for this story.
The case against National Trust, which had revenue of 655 million yuan in 2016, involves wealth management products linked to the steel industry.
The trust was sued in June this year by eight investors who allege it misrepresented the risks involved in products it sold them and failed to adequately assess the guarantor’s creditworthiness.
The trust skirted restrictions on loans to the steel industry by using the products to raise money to lend to a subsidiary of Bohai Steel Group, according to Tang Chunlin, a lawyer at Yingke Law Firm, who is representing the investors.
The plaintiffs invested different sums in the wealth management products, which National Trust promised would deliver an annual return of over 9 percent. National Trust lent the money collected to a Bohai subsidiary, Tianjin Iron and Steel Group Company, according to documents reviewed by Reuters.
Bohai Steel Group, which is undergoing a state-financed restructuring, has liabilities of around 192 billion yuan.
National Trust has now defaulted on the product, according to Tang and Gongyu Zhou, one of the eight investors, because Tianjin Iron and Steel is unable to pay back its loan.The products were also illegally sold via third-party non-financial institutions, Tang and Zhou said.
Zhou said he invested one million yuan in the product over two years from 2015 through 360caifu.com, an online finance platform.
Bohai Steel Group, Tianjin Iron and Steel and 360caifu.com did not respond to requests for comment. National Trust declined to comment.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

china targets a 3 trillion shadow banking industry china targets a 3 trillion shadow banking industry

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

china targets a 3 trillion shadow banking industry china targets a 3 trillion shadow banking industry

 



GMT 10:06 2012 Saturday ,28 July

Querrey advances at ATP LA Open

GMT 21:15 2017 Thursday ,01 June

Trump condemns deadly Kabul explosion

GMT 02:15 2017 Thursday ,24 August

Is your country on the Qatar free entry list of 80?

GMT 19:48 2016 Monday ,03 October

Controversial boxing champ Tyson Fury retires

GMT 08:20 2015 Tuesday ,08 December

PC market woes show no sign of easing

GMT 17:27 2017 Tuesday ,25 April

20 Yemeni soldiers killed, injured in explosion

GMT 11:52 2017 Saturday ,30 December

OIC condemns Mar Mina Church attack

GMT 00:03 2017 Saturday ,25 March

Arab Meeting to Examine Anti-Corruption Methods

GMT 13:12 2017 Thursday ,20 April

Deputy premier meets Arab League chief

GMT 14:13 2014 Friday ,10 January

Opel Astra GTC

GMT 18:27 2016 Tuesday ,02 August

Turkish Foreign Minister arrives in Islamabad

GMT 11:27 2016 Tuesday ,13 December

Saudi woman arrested for challenging social norms

GMT 19:56 2017 Thursday ,09 March

Qatar Pavilion Opens at ITB Berlin

GMT 23:34 2013 Thursday ,07 February

New BMW 3 Series Gran Turismo

GMT 12:57 2017 Friday ,13 October

JPMorgan open to digital money if regulated

GMT 04:38 2017 Friday ,10 March

ADNOC opens fifth ADNOC Xpress

GMT 10:30 2017 Friday ,10 November

BDF military contingent honoured

GMT 17:37 2017 Tuesday ,24 January

China jails former Sinopec president for graft

GMT 19:34 2017 Sunday ,14 May

Austria centre-right calls for snap elections

GMT 14:54 2014 Saturday ,29 November

Wall cladding, wallpaper, fabric and wood!
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2021 ©

arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday