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Failed Chinese bank cut loose from PBOC support – going under

August 10, 2020 by admin 0 Comments

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Chinese financial regulators took control of Baoshang in May 2019 due to serious credit risks

The PBOC will now let it go into liquidation, the first such insolvency since 2001.
PBOC says the bank is permitted to file for bankruptcy and liquidate any remaining assets
The PBOC has allowed 2 other banks to to take over assets and operations on Baoshang

Via Reuters.

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Its a bit of a tricky time for the PBOC to allow this as the sector (the economy as a whole) struggles out of coronavirus impacts. The liquidation of this lender is likely to raise credit costs for similar small banks at the margin and may nudge a few of them closer to a similar fate.

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This article was originally published by Forexlive.com. Read the original article here.