China's Huishang Bank to take over four Baoshang branches - sources (updated)

Huishang Bank

08/01/2020 09:14

(Adds source-based reporting in paras 1-2)
    BEIJING, Jan 8 (Reuters) - China's Huishang Bank  3698.HK 
will take over four branches of Baoshang Bank  BAOTO.UL  under a
state-led reorganisation of the Inner Mongolia-based lender, two
sources told Reuters, as part of Beijing's drive to reduce
financial risks from small lenders.
    Huishang will take over Baoshang's Beijing, Shenzhen,
Chengdu and Ningbo branches in a new round of asset disposals,
the sources told Reuters, declining to be named ahead of formal
announcements. 
    Earlier on Wednesday, Anhui-based Huishang said it would
acquire some assets of other banks and financial institutions,
and invest up to 3.6 billion yuan ($518.56 million) to hold a
stake of no more than 15% in a new provincial commercial bank,
but gave no details.  urn:newsml:reuters.com:*:nFWN29C0UX
    Baoshang declined to comment. 
    Baoshang Bank became the first high-profile case of China's
small lender crisis as financial regulators took control of the
lender in May last year due to "serious" credit risks, rattling
domestic markets and prompting the central bank to inject cash
into the banking system to prevent contagion risks.
    Financial media outlet Caixin first reported on Wednesday
Huishang's involvement in Baoshang's asset disposal.
 urn:newsml:reuters.com:*:nB9N29000S    
    The People's Bank of China said last year that 99.98% of
Baoshang's institutional creditors were fully repaid, and will
restructure the lender as soon as possible.
($1=6.9423 Chinese yuan renminbi)

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