The Enping financial crisis occurred in

Enping Enping, alternately romanized as Yanping, is a county-level city in Guangdong province, China, administered as part of the prefecture-level city of Jiangmen. Enping administers an area of and had an estimated population of 460,000 in 2005 ...

Jiangmen Jiangmen (), alternately romanized in Cantonese as Kongmoon, is a prefecture-level city in Guangdong Province in southern China. As of the 2020 census, its three urban districts, plus Heshan City being conurbated, with 2,657,662 inhabitants ar ...

Guangdong Guangdong (, ), alternatively romanized as Canton or Kwangtung, is a coastal province in South China on the north shore of the South China Sea. The capital of the province is Guangzhou. With a population of 126.01 million (as of 2020) ...

China China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's most populous country, with a population exceeding 1.4 billion, slightly ahead of India. China spans the equivalent of five time zones and ...

after nationwide bank runs in the aftermath of the

1997 Asian financial crisis The Asian financial crisis was a period of financial crisis that gripped much of East Asia and Southeast Asia beginning in July 1997 and raised fears of a worldwide economic meltdown due to financial contagion. However, the recovery in 1998–1 ...

brought a pattern of fraud to light in multiple of the city's banks.

Fraud

Local officials, as well as the bank managers at the local

China Construction Bank China Construction Bank Corporation (CCB) is one of the " big four" banks in China. In 2015, CCB was the 2nd largest bank in the world by market capitalization and 6th largest company in the world. The bank has approximately 13,629 domestic bra ...

(CCB) branch, had illegally allocated funds to their own projects. Other banks involved included the other three of the " big four" Chinese banks: the

Bank of China The Bank of China (BOC; ) is a Chinese majority state-owned commercial bank headquartered in Beijing and the fourth largest bank in the world. The Bank of China was founded in 1912 by the Republican government as China's central bank, repl ...

, the

Industrial and Commercial Bank of China Industrial and Commercial Bank of China Limited (ICBC; ) is a Chinese multinational bank. Founded as a limited company on 1 January 1984, ICBC is a state-owned commercial bank. With capital provided by the Ministry of Finance of China, the ...

, and the

Agricultural Bank of China Agricultural Bank of China (ABC), also known as AgBank, is one of the " Big Four" banks in China. It was founded on 10 July 1951, and has its headquarters in Dongcheng District, Beijing. It has branches throughout mainland China, Hong Kong, Lond ...

. The banks lost ( (US$509m) and (around US$0.5m)) due to the fraud, with the CCB branch alone estimated to have lost US$480m.

Aftermath

Losses incurred by the scandal cost the

People's Bank of China The People's Bank of China (officially PBC or informally PBOC; ) is the central bank of the People's Republic of China, responsible for carrying out monetary policy and regulation of financial institutions in mainland China, as determined by ...

(PBOC) RMB 6.8b. As banks pulled out of Enping, residents were denied access to financial services into the early 2010s.

References

Enping Jiangmen Guangdong Financial crises {{China-hist-stub