Chinese regulators made fresh efforts to calm anger about a bank fraud that has sparked protests across the globe. They announced a second round of repayments to depositors who had their funds frozen in two provinces.
Authorities said that some deposits were frozen at four rural lenders in central Henan and one in eastern Anhui. This was part of a complicated scam involving a private group with stakes within the lenders. The group had colluded with bank staff to falsify data and siphon off illegal funds.
Tanks were seen on the streets of Henan Province, China, on July 20, 2022
Tanks were seen on the streets in Henan, a Chinese province. According to media reports, they protect banks against angry depositors.
The government freezes money in citizens’ accounts and refuses to return it under the pretence that it is an investment. Only $7,000 of the $6 billion frozen has been returned in recent weeks.
China’s largest protest in recent years was staged by bank customers demanding their money back. This violent incident is just the tip of China’s banking crisis.
Since April, the scandal has been the subject of widespread protests by outraged depositors and placed a spotlight on the approximately 4,000 banks that are small or medium-sized in the country.
Henan and Anhui provinces made repayments to depositors in smaller amounts on July 15. This was after they were investigated by authorities and arrested suspects.
Financial authorities in Henan announced that they will begin the second round of client repayments for the four rural banks from July 25.
Individuals who have deposits up to 100,000 yuan (or $14,787) will be repaid. This was announced jointly by the Henan branch and the provincial financial bureau.
Anhui’s Bengbu City officials made a similar statement. They stated that they will begin repaying customers at a bank with deposits between 50,000 and 100,000 yuan.
China is currently dealing with the scandal at the rural bank and a growing boycott of mortgage payments in the country. This year is politically sensitive for Beijing.
