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Central Bank Punishes Law-Breakers
China's State-owned commercial banks have punished 538 people held responsible for extending fictitious letters of credit, deposit and undertaking over the past few months, according to a spokesman for the People's Bank of China (PBOC).
The spokesman said the commercial banks have carried out the punishment under the instruction of the central bank. Of those punished, 173 have been expelled from the banking sector.
He said that in the second half of 2000, the PBOC issued a circular demanding commercial banks to examine their businesses concerning the letters of credit, deposit and undertaking, in a bid to effectively minimize potential risks.
All the State-owned commercial banks have paid great attention to the check-up and adopted measures to standardize their practices in opening such letters.
With the implementation of this move, State-owned commercial banks' related businesses have basically entered an orbit of healthy development, and related risks have been brought under control, he said.
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