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The regulator has confiscated a total of 661 million yuan of
illegal income and handed out fines totaling the same amount,
according to a statement posted on the website of the China
Banking Regulatory Commission (CBRC).
Guangfa Bank had provided illegal guarantees for corporate bonds
issued by Chinese phone maker Cosun Group, and sought to conceal
the extent of the bank's debts.
When the high-yielding bonds defaulted in December 2016, the
online platform on which the securities were sold wanted
Zheshang Property and Casualty Insurance Co, the insurer of the
bonds, to repay investors.
Guangfa Bank then said the documents the Guangzhou-based bank
had given to the insurer to back the bonds were all fake.
CBRC previously said the case was one of the most grievous
instances of collusion. Earlier this month, the banking
regulator imposed a record financial penalty on Guangfa Bank and
said the fraud had involved 12 billion yuan and more than 10
financial institutions.
Among the 13 financial institutions that had supplied funds to
Guangfa Bank were the Postal Savings Bank of China Co <1658.HK>
and the Zhengzhou and Qingdao branches of Industrial Bank Co
<601166.SS>, the CBRC said in a statement on Friday.
Five rural commercial banks and a credit cooperative in the
northeastern province of Jilin were also punished by CBRC.
(Reporting by Ryan Woo and Beijing Monitoring Desk; Editing by
David Evans)
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