4,000 Banks In China Are On The Verge Of ‘Bankruptcy’, Govt. Attacks Protestors
World’s 2nd largest economy, China, is facing a high level banking crisis. Banks are on the verge of bankruptcy. People can’t withdraw their own money since April.
Due to the Corona outbreak, the second-largest economy in the world (the Chinese economy) is in poor shape. Pressure is high, particularly on the financial industry.
Approximately 4000 of these small banks are reportedly on the edge of closing. More than 4 lakh clients and thousands of crores are at risk with these institutions.
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These consumers have been unable to withdraw money from the bank since April. A CNN Business report claims that the issue began in April when 4 banks in the Henan region decided to immediately stop cash withdrawals.
In terms of the Chinese financial system, regional banks are only permitted to take deposits from their domestic clientele. possessed a legal right.
These banks, however, were also collecting deposits from non-resident depositors with the use of third-party platforms.
He initially hails from the eastern city of Wenzhou, according to Peter (name changed) who spoke with CNN Business.
However, he put $6 million into three little banks in the Henan area of central China. They are currently unable to withdraw their funds.
He claims that this is the situation faced by all bank customers.
Banks Have Suspended Their Websites
Peter added that when he logs into internet banking, the website is down. When it functions, a notification indicating that maintenance is being done is sent.
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The recent weeks have sent out a maintenance message. According to the National Banking Regulator, there is a common large stakeholder among the four banks that have been having issues since April.
He is improperly and unlawfully taking deposits from depositors. Henan New Fortune Group is the organization behind this promotion. This group is reported to have used external sites to raise money.
Banking & Real Estate Crisis In China
According to experts, China is currently experiencing a real estate crisis. In addition to this, a horrible increase in poor dates is being observed because of Corona.
The financial market is in risk as a result of the current circumstances. The amount of deposits held by these institutions that depositors cannot withdraw is unknown at this time.
People Can’t Withdraw Their Money Since April
In April, the government-owned Chinese publication Sanlian Lifeweek published a story on the subject. He claims that around 4 lakh consumers are unable to make withdrawals from their accounts.
According to a Financial Times investigation, Chinese depositors have had difficulty getting their money out for the past two months.
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The financial health of the nation’s small banks is always the subject of bad news that is upsetting. People’s performance is improving in such an environment.
Billions At Stake For Millions Of Customers
The billions of money of millions of Chinese people are at stake. They can’t withdraw their own money since April. Banks have already closed their websites.
Frustrated bank customers are protesting now against the banks as well as the federal government. But in return they are getting tear gas and assaults.
