Reports: Chinese bankers detained in loan probe
BEIJING --A vice president and another executive of a midsize Chinese bank in which Citigroup Inc. owns a stake have been arrested in a probe of possible misconduct in handling bad loans, news reports said Friday.
Two more people connected to Guangdong Development Bank are under investigation, according to the Beijing Times newspaper and Cajing, a leading business magazine.
Bank vice president Wang Xin was arrested June 19, Caijing said. The Beijing Times said a deputy general manager of the bank in the southern business center of Guangzhou was arrested and investigators searched Wang's home and office. Both reports cited unidentified sources and gave no details of the possible offenses.
Chinese banks have suffered a string of scandals over allegations of embezzlement and other misconduct.
Citigroup led a consortium that bought 85.6 percent of Guangdong Development Bank in 2006 for 24.3 billion yuan ($3.1 billion). Citigroup got a 20 percent stake and "management influence," though not control. Its partners included China Life Insurance Co.
A Citigroup spokesman in Shanghai, Stephen Thomas, declined to comment.
Guangdong Development Bank's president, chief financial officer and chief credit officer are Citigroup employees. The reports Friday gave no indication that events under investigation took place after the Citigroup-led purchase.
The prosecutor's office in Guangzhou did not immediately respond to requests for information.
Guangdong Development Bank's chairman, Li Ruohong, resigned unexpectedly Monday, citing health reasons, according to the Chinese news reports.
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On the Net:
Guangdong Development Bank (in Chinese): http://www.gdb.com.cn/comminfo/index.html 