China’s state-run bank says it has enough reserves to cover up losses
The China National Bank on Tuesday said it had enough reserves of about 2 trillion yuan ($320 billion) to cover its first-quarter losses as a result of a crackdown on speculative trading, state media reported.
The bank said the cash was needed to cover losses from trading that had not yet been recorded.
The statement did not give an estimate of the value of the reserves, but the report appeared to indicate the bank had enough to cover the first three quarters losses, which would have triggered a cash injection of up to $60 billion.
The news came a day after China’s central bank warned that a prolonged ban on speculation on futures contracts was hurting China’s economy.
The central bank said on Monday it would step up restrictions on the amount of capital people can invest in financial instruments to prevent speculative trading.