(CBN Global) April 8 -- Bank of Tianjin Co., which listed in Hong Kong eight days ago, reported a CNY786 million (USD121 million) 'risk incident' related to its bill-financing business. China's police have started to investigate the bank.
The bank said it has been 'proactively' working with police to secure the funds. The incident happened at the lender's Shanghai branch, the company said in a filing to the Hong Kong stock exchange today.
China Citic Bank Corp. in January uncovered a risk incident in relation to its notes business involving CNY969 million, while larger rival Agricultural Bank of China Ltd. earlier revealed a CNY3.9 billion case of bill fraud at its Beijing branch. The bills, or notes, are used for short-term corporate lending, but have often been used to fund speculative investment, and are sometimes used by banks to inflate balance sheets to meet regulatory requirements.
Bank of Tianjin sought to raise as much as USD1.23 billion in its initial public offering last month. It raised almost USD950 million selling shares near the bottom end of the range. The stock has lost almost 1 percent since its debut.
Bank of Tianjin is named after the northern Chinese port city in which it is based. The lender had CNY545.7 billion (USD84 billion) in assets as of Sept. 30, compared with CNY478.9 billion at the end of 2014, according to a pre-listing document posted to the stock exchange earlier this month.