Thursday, March 17, 2005

Chinese bank boss: sudden exit

by Brian Turner

Zhang Enzhao, chairman of the China Construction Bank, has suddenly resigned for alleged personal reasons.

However, media in Hong Kong have speculated that the move follows fraud probes into the company’s dealings, with money missing from branches, and allegations of kickbacks for bad loan agreements.

Chinese regulators have apparently already revealed a series of scandals involving embezzlement and loans-for-favours, and have called for scrutiny on all large loan agreements with the company, to reduce irresponsible lending which has seen banks’ bad debts swell to at least $190bn.

The previous president of the China Construction Bank was jailed in 2003 for a total of 12 years for corruption allegations while runnng the Bank of China.

China is currently trying to clean up its banking system and companies, reading for large scale stock flotation of banks such as The China Construction Bank.

The bank is expecting to list its shares in Hong Kong later this year, in a flotation which could raise up to US$10bn (£5.2bn).

Chinese banks are seeking to clean up their image as they try to raise capital by listing their shares overseas.

Chinese banks have been dogged by persistent corruption scandals in recent years, leading the Chinese government to identify banking reform as a key priority.

China Construction Bank and Bank of China - also looking to list overseas - shared a $45bn state bailout in 2003 to improve their balance sheets ahead of a potential stock market flotation.

 

 

 

Stories related to: Chinese bank boss: sudden exit

 

 

Visited 628 times, 1 so far today