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 Police and security guards stood by as dozens of people formed a
line outside a branch of Rural Commercial Bank of Huanghai, one of
the two banks that have suffered a rush of withdrawals this week on
the outskirts of the city.
The Huanghai bank was open as normal and its electronic billboard
urged depositors not to be worried by rumors.
Also in Yancheng, a queue of around 25 people formed outside a
branch of Jiangsu Sheyang Rural Commercial Bank, the first bank to
be identified in local media reports on Monday as being mobbed by
depositors attempting to withdraw their savings on fears that it had
become insolvent.
The governor of Sheyang county, which includes Yancheng, posted a
video on the county government's website, urging depositors not to
panic and saying bank deposits were protected.
"Please be assured that the People's Bank of China and the rural
commercial bank system will ensure the interests of all depositors
will be protected," county governor Tian Weiyou said in the
two-minute video statement.
"The county's rural commercial banks will ensure that there will be
enough funds for depositors to withdraw at any given time."
Staff at the Jiangsu Sheyang bank were also handing out copies of a
statement dated March 24, endorsed by the local branch of the
central bank, People's Bank of China, as well as the China Banking
Regulatory Commission and the Zhejiang Sheyang Rural Commercial
Bank. The statement sought to reassure depositors about the
condition of Jiangsu Sheyang bank.
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"The bank has total deposits of 12 billion yuan ($1.93 billion), the
most in Sheyang county, its capital position is very strong," said
the statement.
Huanghai and Jiangsu Sheyang banks declined to comment. An official
at Jiangsu Sheyang referred media inquiries to Yancheng city's
propaganda department.
There is growing anxiety among investors in China about potential
insolvencies as regulators signal greater tolerance for credit
defaults.
The county governor, whose statement focused on Jiangsu Sheyang
bank, said the lender was state controlled and that security
officials had started an investigation into the issue.
"Those who create and spread rumors will be punished in line with
law to maintain social stability," he said.
($1 = 6.2024 Chinese yuan)
(Additional reporting by Adam Jourdan, Chen Yixin, Pete Sweeney and
Lu Jianxin in Shanghai; editing by Mark Bendeich)
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