Henan vows to release frozen bank funds after violent protest
The local financial regulator in China’s central Henan province said it will start releasing customer funds from the four rural banks that have reportedly frozen around 39 billion yuan (US$5.8 billion) from July 15, following Sunday’s violent clash between protesters and the police.
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Fast facts
- Henan’s financial authorities did not reveal the source of repayments it pledged to release.
- The national bailout fund for banks — China’s National Deposit Insurance Fund — had a balance of 96.03 billion yuan at the end of 2021.
- On Sunday, nearly 3,000 people gathered at the People’s Bank of China’s Zhengzhou branch to protest against getting locked out of their deposits since April, leaving some protesters wounded and injured, according to viral online videos documented by online social media users.
- Local police claimed in a press release that Henan New Wealth Group and its head Lu Yi, the majority owner of three of the four rural banks, illegally transferred funds and manipulated banks’ data.
- China had 1,651 rural banks by the end of 2021, with 103 classified as “high financial risk,” according to the data from the China Banking and Insurance Regulatory Commission (CBRC) and the People’s Bank of China (PBoC).
- In 2009, China announced plans to boost the rural economy, which included setting up 1,027 rural banks.
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