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19-04-2017, 01:52 PM
China’s Minsheng Bank sees investor trust vanish – along with 3b yuan
by Zheng Yangpeng
PUBLISHED : Tuesday, 18 April, 2017, 11:13pm
UPDATED : Tuesday, 18 April, 2017, 11:13pm
The disappearance of 3 billion yuan (US$436 million) from China Minsheng Bank’s private banking accounts has once again highlighted Chinese banks’ weak internal controls and the risks associated with the sale of so-called “innovative” wealth-management products on the mainland.
An accidental inquiry from an investor exposed the fact that the WMPs sold by a Minsheng branch didn’t even exist. When shocked investors rushed to the bank, they found the head of the branch had been taken into police custody and the supposed due payment date had passed.
Investors are still waiting for compensation as well as a detailed explanation from the bank.
“If we can’t even trust a big national bank, what other financial institutions can we trust?” Liu Min, who bought 12 million yuan worth of WMPs from Minsheng, said as he waited in the lobby of the Hangtianqiao branch of Minsheng Bank to hear news. Two million yuan of the WMP he invested in is was “due” April 17 but he can’t get the money back.
Liu, 52, was one of 150 private banking customers of Minsheng who had bought the WMPs. In most cases, their ties with the lender go back 10 years when the Hangtianqiao branch joined them up in a “golf club”. Under the programme, they frequently invested in the products offered by the branch and in return, the bank paid for them to go on golfing trips domestically and overseas.
More details in http://www.scmp.com/business/banking-fin...h-along-3b
by Zheng Yangpeng
PUBLISHED : Tuesday, 18 April, 2017, 11:13pm
UPDATED : Tuesday, 18 April, 2017, 11:13pm
The disappearance of 3 billion yuan (US$436 million) from China Minsheng Bank’s private banking accounts has once again highlighted Chinese banks’ weak internal controls and the risks associated with the sale of so-called “innovative” wealth-management products on the mainland.
An accidental inquiry from an investor exposed the fact that the WMPs sold by a Minsheng branch didn’t even exist. When shocked investors rushed to the bank, they found the head of the branch had been taken into police custody and the supposed due payment date had passed.
Investors are still waiting for compensation as well as a detailed explanation from the bank.
“If we can’t even trust a big national bank, what other financial institutions can we trust?” Liu Min, who bought 12 million yuan worth of WMPs from Minsheng, said as he waited in the lobby of the Hangtianqiao branch of Minsheng Bank to hear news. Two million yuan of the WMP he invested in is was “due” April 17 but he can’t get the money back.
Liu, 52, was one of 150 private banking customers of Minsheng who had bought the WMPs. In most cases, their ties with the lender go back 10 years when the Hangtianqiao branch joined them up in a “golf club”. Under the programme, they frequently invested in the products offered by the branch and in return, the bank paid for them to go on golfing trips domestically and overseas.
More details in http://www.scmp.com/business/banking-fin...h-along-3b
Specuvestor: Asset - Business - Structure.
