Bohai Bank Used Customer Deposits as Collateral, Insider Embezzlement or Bankrupt?

Shine: China Bohai Bank accused of misusing US$438m of enterprise client's money

China Bohai Bank, a national joint-stock commercial bank based in the northern city of Tianjin, has been accused by an enterprise client of secretly using its 2.8 billion yuan (US$438 million) in deposits as collateral.

Jiangxi Jemincare Group Co, which focuses on R&D and production of modern Chinese medicine, biological agents and health-care products, said its deposits in Bohai Bank were used as collateral by the bank in secret for a petrochemical company in Nanjing, Jiangsu Province, and there was no connection between the two firms.

Bohai Bank issued a notice on its official website on Sunday, saying it has noted certain media reports regarding the pledge and guarantee business of its Nanjing Branch.

"We have reported the matter to the public security authorities after discovering 'abnormal behaviors among (our) enterprise clients' and will seek judicial solutions according to law," the bank said.

iFeng: 渤海银行28亿存款风波：涉事员工无法联系 8亿存款或再被划扣

Recently, Bohai Bank's 2.8 billion deposits were pledged and guaranteed without the knowledge of corporate depositors. At present, according to preliminary investigations by relevant departments of Jiangsu Province, the seals on these loan guarantee and pledge business materials are suspected of forgery, and further facts are subject to verification and disclosure by relevant departments. According to people familiar with the matter, Guan Pengcheng, assistant to the general manager of the business department of the Nanjing branch of Bohai Bank, has lost contact. The reporter called Guan Pengcheng's personal telephone and company landline telephone, but failed to get through.

In August of this year, Jimin Trust Group (hereinafter referred to as Jimin Trust), a well-known pharmaceutical company in Jiangxi, accidentally discovered that two of its subsidiaries, Shanhe Pharmaceutical and Hang Seng Pharmaceutical, had deposited 2.8 billion yuan in deposits in the Nanjing branch of Bohai Bank in the company. It was pledged without knowing it and provided financing guarantee for the third-party company Huaye Petrochemical.

According to Jimin Trusted sources, after the incident was exposed, Guan Pengcheng, assistant to the general manager of the business department of the Nanjing branch of Bohai Bank, paid a visit and gave a solution. What is surprising is that the person in charge even suggested that Jimintong continue to use Shanhe Pharmaceutical to deposit 500 million yuan to provide deposit certificate pledge for Huaye Petrochemical's loan from Bohai Bank. He also warned that if Jimin Trust does not provide guarantees, after Huaye Petrochemical expires, the bank will still use Jimin Trustworthy deposit certificates to pay. If Jiminxin chooses to call the police, the company's 2.8 billion yuan deposit certificate will be frozen, and the deposit certificate and money will not be taken away.

Up to now, due to Huaye Petrochemical’s 500 million yuan loan that has not been repaid on August 25, the Nanjing branch of Bohai Bank has forcibly deducted 450 million yuan from the deposits of Jimin Trust’s subsidiary (the other 50 million yuan is from Huaye Petrochemical’s book The balance is crossed out), and Jimin Trust has another 2.3 billion yuan that is still in pledge.

In addition, relevant personnel of Jimin Trust revealed to a reporter from the Central Broadcasting Network that Jimin Trust will have three deposits maturing one after another in late November, with a total deposit of 800 million yuan. They are very worried that when the deposit is due, not only may it not be withdrawn, but it may also be forcibly deducted by the bank again.

At present, both parties involved have reported that they have reported the case to the police, but the latest development of the case has not yet been made. The outside world believes that if Bohai Bank does exist in the circumstances described by Jimin Trustworthy, the bank may be suspected of embezzling funds or illegally issuing loans.

Another iFeng story here: 实地调查：渤海银行28亿存款风波背后的隐秘融资方. This story is getting subtantial attention at iFeng with its own section here: 渤海银行28亿存款遭莫名质押担保