(Yicai Global) Dec. 7 -- China's banking and insurance regulator has handed Bank of China a fine of CNY50.5 million (USD7.7 million) and ordered it to rectify after the lender's clients lost big sums of money due to a mismanaged oil futures product.

Moreover, four employees of the bank's global marketing department will need to pay a total tally of CNY1.8 million (USD275,351), the China Banking and Insurance Regulatory Commission said in a statement on Dec. 5.

The Beijing-based lender was reported to have been cleaning up the impact already in May. BOC had been talking with its customers to return up to 20 percent of the initial investment to those who had poured less than CNY10 million (USD1.4 million) into the product linked to West Texas Intermediate crude futures after the oil benchmark's expiring May contract collapsed to negative territory on April 21 for the first time in history, Securities Times reported on May 6, citing several investors. The investors had had different ideas about which point of time the settlement price should be based on.

The CBIRC also suspended "access for Bank of China's relevant business and branches," without specifying the target. It ordered the lender to investigate its personnel and rectify its business in accordance with laws and regulations. BOC's Crude Oil Treasure violated several rules, mainly involving its product, risk, and sales management, the regulator added.

On Dec. 5, BOC replied to the ruling. It said that it will standardize its sales operations and hold the people responsible accountable, adding that the penalty should have no major adverse impact on its financial performance.

More than 60,000 BOC customers lost CNY4.2 billion (USD642.6 million) due to the cratering oil prices, financial news outlet Caixin reported on May 5. Moreover, as WTI dipped below zero, investors also owed CNY5.8 billion to the bank. After the incident, many other Chinese lenders have stopped opening new commodity trading accounts.

Editor: Emmi Laine