China anti-graft agency says Bank of Jilin's ex-chief under probe (updated)

Bank of Jinzhou Co

18/11/2019 10:04

(Adds background)
    BEIJING, Nov 18 (Reuters) - China's anti-graft watchdog said
on Monday the former chairman of Bank of Jilin Co  JLBNK.UL  is
being investigated, according to a statement on the website of
the Central Commission for Discipline Inspection (CCDI).
    Zhang Baoxiang, the bank's ex-chairman and ex-party chief,
is suspected of serious violation of laws and regulations, CCDI
said, without elaborating.
    The rare seizure by government of Baoshang Bank earlier this
year and state rescues of Jinzhou Bank  0416.HK  and Hengfeng
Bank have sharpened concerns about the health of hundreds of
small lenders as China's economic growth slows to near 30-year
lows.
    In the past month, speculation of poor management prompted
two rare bank runs in central and northeastern China
respectively, fueling renewed concerns of banking risks.
    Zhang stepped down from his roles in the bank in November,
according to the statement.
    Bank of Jilin was not immediately contactable for comment.
    Total assets of the Bank of Jilin stood at 368.1 billion
yuan ($52.63 billion) by end-June, according to its semi-annual
report. 
    Net profits over the first six months of this year almost
halved year-on-year to 784.9 million yuan, while its
non-performing loan ratio was 2.86% by end-June, higher than the
industry-wide average of 2%.
    The risks facing the bank mainly stemmed from concentrated
loans to single clients, mounting investments, deteriorating
asset quality, and insufficient capital, according to credit
rating report by China Lianhe Credit Rating Co. 
    The bank was among a batch of smaller lenders, including the
Bank of Jinzhou, who delayed its 2018 annual report.
  
($1 = 6.9941 Chinese yuan renminbi)

 (Reporting by Cheng Leng, Ryan Woo and Beijing Monitoring Desk;
Editing by Muralikumar Anantharaman and Louise Heavens)
 ((cheng.leng@thomsonreuters.com; +8610-5669-2129;))