Weak risk controls heighten risk of Chinese bank WMPs
Chinese Banks urgently need to resolve weak oversight of wealth management products in order to avoid scandals such as Hua Xia Bank’s failed WMP.
Chinese investors recently gathered at the gates of Hua Xia Bank’s Jiading branch to protest the bank’s default in a wealth management product. While judicial results have yet to be released, the claim is that an employee allegedly sold the bulk of a wealth management product to the equivalent of 119 million renminbi ($19.1 million), with the bank now not being able to repay said investors.
It is bemusing that an unpermitted wealth management product could be sold at a bank branch for over half a year without the bank’s knowledge. In this case, the concern is not only about an employee’s…
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, Retail Banking
, Risk and Regulation
, Wealth Management
Keywords: Hua Xia Bank
, Xiao Gang