It once figured out the future of Chinese banking. It was a private bank that everyone thought would "cut" money by surpassing its state competitors.
One wrong turn, however, made her one of the biggest victims of debt-ridden real estate lending, causing a rift in Asia's largest economy. The wrong move was to provide loans to the real estate industry.
Losses from loans to companies, one of which was the long-suffering Evergrande, began to accumulate for China Minsheng Banking. Its share sank with losses of 31% in the twelve months until last week. This was the worst performance among 155 banks in the Bloomberg World Banks index.
People familiar with Minsheng's activities report that the bank, which was established in 1996 as China's first non-state-owned bank, is currently in the process of controlling losses.
It has restructured its financial real estate group to give more power to local branch managers, has made debt reduction a top priority for 2022 and plans to cut staff salaries by half.
Minsheng has an exposure of about 130 billion yuan ($ 20 billion) in high-risk real estate development companies, or 27% of its so-called core equity.
SOURCE: Bloomberg / newmoney.gr
