The rescue of troubled regional lender Baoshang Bank,which was taken overby Chinese regulators in May because of what they described as its “severe credit risk,” is coming to an end, reported Caixin.
Mengshang Bank, a new commercial bank set up to take over Baoshang’s operations in its home territory of Inner Mongolia, officially came into being on Saturday at a ceremony attended by the lender’s new chairman and president, sources with knowledge of the event told Caixin.
Mengshang has been established with registered capital of RMB 20 billion ($2.8 billion) and capital reserves of RMB 4 billion, according to a March filing by Hong Kong-listed Huishang Bank, one of the new lender’s major shareholders.
The People’s Bank of China (PBOC), the central bank, has the biggest stake in Mengshang with, 27.5%, which it holds through a wholly owned company Deposit Insurance Fund Management, according to the filing. The latter company was set up in 2019 to manage a RMB 100 billion fund to protect depositors’ savings at financial institutions.