The PBOC and China Banking and Insurance Regulatory Commission assumed control of Inner-Mongolia-based Baoshang Bank last month. Photo: Reuters
Zero Hedge: Domino #2: Chinese Bank With $105 BN In Assets On Verge Of Collapse
While the western world (and much of the eastern) has been preoccupied with predicting the consequences of Trump's accelerating global trade/tech war, Beijing has had its hands full with avoiding a bank run in the aftermath of Baoshang Bank's failure, scrambling to inject massive amounts of liquidity last week in the form of a 250 billion yuan net open market operation to thaw the interbank market which was on the verge of freezing, and sent overnight funding rates spiking and bond yields and NCD rates higher.
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WNU Editor: The Chinese Central Bank is telling everyone to stay calm .... China central bank urges calm after Baoshang takeover (Reuters). More here .... Baoshang Bank takeover an isolated case, PBoC says (Asia Times), and here .... Baoshang Bank takeover connected to misappropriation of funds but was an isolated case, China’s central bank says (SCMP/Bloomberg). Here is a good analysis on why this is a big deal .... There are 3 reasons China just took over a bank for the first time in 20 years, and 2 of them are a huge deal (Linette Lopez, Business Insider)
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ReplyDeleteChina with its rapid growth took on massive debts (in the banks), this is similar to the bubble of 2007 and will come to fruition in China. What happens after will be telling.
ReplyDeletetoo big to fail
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ReplyDeleteBefore the adjustment going on in the world is over, China will own many banks, methinks.