At least China's Bank are all squeaky clean - no dud loans in...

At least China's Bank are all squeaky clean - no dud loans in China is there?

Fourth bank bail-out costs China $40 billion
Thursday, August 9th, 2007

agricultural bankThe state press has reported China will spend $40 billion bailing out the debt-laden Agricultural Bank of China which is considered by outsiders to be the weakest of the country’s big four commercial banks.

(Back in 2005, according to a report in the Chinese media, former Agricultural Development Bank of China vice presidents Hu Chushou and Yu Dalu were charged with embezzling RMB810 million ($98 million) which would not have helped.)

The Economic Observer reported the funding will come from China’s new forex investment agency, which will manage part of the country’s foreign exchange reserves of more than $1,330 billion.

China’s finance ministry was authorised early this year to issue $205 billion in bonds to fund the establishment of the agency. Agricultural Bank is the last one of the big four state lenders to undergo a government-aided financial overhaul. The aim is that once this is completed — the aim is by the end of this year — then the bank could be listed on the stock market.

The Economic Observer reports that the forex agency is expected to be set up in September and would would use $65 billion to take over the central bank’s investment arm, Central Huijin Investment, which would then inject $40 billion into the Agricultural Bank.

China has bailed out the other three major banks — Industrial and Commercial Bank of China, the Bank of China and the China Construction Bank — with a total of $60 billion.