News, analysis and personal reflections on the markets & the financial sector

Friday, August 7, 2009

Bank fraud trial begins in China

Executives charged with being involved in China's largest alleged bank fraud have gone on trial in the south of the country, it has been reported.

According to Reuters, Caijing magazine states that bank officials and property developers charged with fraudulently borrowing $1.44 billion from Bank of Communications (BoCom).

Around half of the money has been recovered, with an unnamed representative telling the news source that the case would not have an impact on the earnings of BoCom this year.

Officials first began investigating the case in 2007 and the magazine added that police are still attempting to locate former BoCom regional president Liu Changming who is suspected of being involved in the alleged fraud.

BoCom is China's fifth largest bank by assets and is partially owned by HSBC. It recently posted a 39.87 per cent quarter-on-quarter increase in net profit for the opening three months of the year, with the figure totaling $1.16 billion.

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