Chinese regulator imposes US$27.6 million in fines on banks hiding bad loans
BEIJING - In the two months since the arrival of its new Chairman, China’s top banking regulator has been flexing its muscles in a regulatory upheaval aimed at sweeping out some long-standing problems in the industry.
Caixin reports that since late March, the China Banking Regulatory Commission (CBRC) has issued at least seven policy documents with new and tightened regulations that target the goals of reducing systemic risk, as well as deleveraging and enhancing governance of the banking sector.
The sector has been plagued by mounting bad loans and rising risks from “shadow lending” activities — business similar to those provided by commercial banks but conducted by enterprises not under regulatory oversight, Caixin says.
“The CBRC has bared its teeth. In the first quarter, the Commission has imposed fines of 190 million yuan (US$27.6 million) on dozens of banking institutions for hiding bad loans, circumventing regulations and charging fees illicitly.
“Liu Fushou, Director of CBRC’s legal department, said more cases are under investigation, and “regulators will slap harsh punishments on market violators to curb frequent misbehaviour’.” www.webershandwick.cn (ATI).