The China Banking Regulatory Commission (CBRC) has issued a circular to tighten controls on the sales of third-party investment products, such as insurance, trust products and investment funds, through bank branches following the Hua Xia Bank incident.
Banks are given up to 15 days to complete their investigations. CBRC says that it will conduct random checks on bank branches after they submit self-assessment reports.
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Bank branches that discover rule-breaking behaviour and major risks are to report them promptly to their headquarters. They are also to come up with effective measures together with the relevant institutions to target these risks.
The tightening of controls comes after by investor protests at Hua Xia Bank’s failure to make pay-outs upon the maturity of a product last November. The bank has ascertained that an employee at its Jiading branch sold the product without authorization.
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By GlobalData
