Amid Real Estate Crisis... Regulatory Violations Found in Chinese Banks and Asset Managers

Abnormal Funding Provided to Real Estate Development Company

As the Chinese real estate crisis spreads, Chinese authorities have identified banks and asset management companies that violated regulations.

According to major foreign media on the 18th, the China National Financial Regulatory Administration disclosed that it imposed fines on Agricultural Bank of China, Minsheng Bank, and Huarong Asset Management.

Among them, Agricultural Bank of China was fined 44.2 million yuan (approximately 8.1 billion KRW) for reasons including providing abnormal funding to real estate developers.

Minsheng Bank was fined 47.8 million yuan (approximately 8.8 billion KRW) for violating regulations by illegally using bond investment trust businesses to provide funds to companies.

Meanwhile, on the 17th (local time), Chinese real estate developer Hengda (Evergrande) filed for bankruptcy in the Manhattan Bankruptcy Court in New York, USA. Since December 2021, Hengda Group has been experiencing management difficulties after officially defaulting for the first time on offshore bonds worth 22.7 billion dollars (approximately 30.4 trillion KRW). Subsequently, defaults by other real estate companies followed, raising concerns about the health of the real estate industry, and this crisis was on the verge of spreading to the financial sector.

[Image source=Yonhap News]

This content was produced with the assistance of AI translation services.