Beijing’s wholesale crackdown has reportedly reached the financial sector with concerns about the closeness between industry players and the private sector.
Chinese President Xi Jinping is boosting scrutiny of the ties between financial institutions – including state-owned banks, investment funds and financial regulators – and large private companies, according to a «Wall Street Journal» report citing unnamed sources.
The involves an examination that was first announced in September but has since ramped up to determine whether state-controlled financial firms have become «too chummy» with private firms, especially those that have come under fire such as China Evergrande, Didi Global and Ant Group.
Domestic Examination
The examination will focus on reviewing files on lending, investment and regulatory records at 25 financial institutions.
One of the financial institutions named in the report is Citic Group, which is believed to have provided more than $10 billion to Evergrande.
Firms suspected of inappropriate dealings are likely to be formally investigated by the Chinese Communist Party and potentially charged later, the report added.
