Banks punished for aiding speculation
2 July 2007
Twenty-nine banks, 10 of them foreign, have been punished for channeling speculative capital into the country's stock and property markets, the Financial Times reported. The foreign banks include Citibank and HSBC, while the domestic banks include Bank of China, Bank of Communications and Industrial and Commercial Bank of China. The State Administration of Foreign Exchange (SAFE) meted out "unspecified punishment" for "assisting speculative foreign capital to enter the country disguised as trade or investment." The capital inflows had a "serious effect" on government efforts to slow growth, Deng Xianhong, SAFE's deputy director, said. Some of the banks claimed ignorance of the punishment, while others acknowledged it and said they were in discussions with SAFE.