Embattled Bank of Jinzhou plans to suspend dividend payments on its offshore preference shares, becoming the first Chinese lender to do so as concerns grow over the country’s banking system, said the Financial Times.
The bank pinned the blame for the decision on its capital adequacy ratios, which no longer meet regulatory standards, according to a stock exchange filing late on Sunday. The bank was seeking shareholder approval to cancel dividends on the preference shares for the 12-month period ending October 26 2019, the filing added.
The proposal to halt payments came after the bank on Friday reported an annual net loss of more than RMB 4.5 billion ($627 million) for 2018, after breaking months of silence on its performance with a long-delayed profit warning just weeks earlier. The bank followed that on Sunday with its first-half results, when it reported a loss of RMB 868 million.