Chinese President Xi Jinping will launch an inspection on the ties between China's state banks and other financial honchos with big private-sector players that VP Wang Qishan allegedly helped avoid for years, the Wall Street Journal reports. Wang Qishan for years had installed people close to him in important positions at state-backed financiers.
China aims to address the economy's dependence on debt-fueled construction sprees, prompting turmoil in China's property sector. Xi will focus on the links with private firms like Evergrande Property EVGPF EVGPY, DiDi Global Inc DIDI, and Alibaba Group Holding Ltd BABA backed Ant Group that was recently under regulatory crossfire.
China's top anti-corruption agency will review the files of 25 financial institutions regarding their lending, investment, and regulatory records and seek explanations on specific deals or decisions related to the private firms.
The Communist Party will formally investigate the individuals suspected of engaging in inappropriate dealings, including disciplinary action. It could also slash the executives' compensation at the state financial juggernauts.
The inspectors in charge of examining the institutions will "thoroughly search for any political deviations." China will probe state banks' lending to faltering developer Evergrande struggling with over $300 billion in liabilities and lending to Jack Ma's beleaguered fintech Ant Group and ride-hailing firm undergoing cybersecurity probe DiDi.
Regulators, including China's central bank and the top banking, insurance, and securities watchdogs, have also attracted scrutiny for alleged negligence in supervising companies or become too close to industry players.
Price Action: BABA shares traded higher by 2.20% at $165.07 on the last check Monday.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
