The dragon begins to fall…
China has launched a pilot programme in the northern province of Hebei requiring the public to apply for approval if they plan to make large cash deposits or withdrawals at commercial banks.
The regulation comes after a series of bank runs in the past year at debt-laden small lenders and as an unprecedented pandemic-related economic contraction starts to take a toll.
From July 1, residents in the province will need to provide information about the source of deposits or the purpose of withdrawals for transactions over 100,000 yuan (US$14,162) for individuals, and 500,000 yuan for corporations, the state-backed China Securities Journal reported last week.
Applicants will have to give one day’s notice to the bank to make a withdrawal of this size or larger, and gain the branch’s approval of the registration information, the report said.
The pilot programme will be expanded to Zhejiang province in the east and the city of Shenzhen in Guangdong province from October 1, affecting individual account transactions of more than 300,000 yuan and 200,000 yuan, respectively.
FWIW, I have zero invested in China funds and zero in “emerging market” funds (that tend to have a big Chinese component).
What with the EU headed for a financial crisis now that the UK money has left the budget, Africa in social turmoil and afflicted with Chinese takedowns via debt trap diplomacy, Brazil headed for a Chinese Wuhan Covid virus stumble, and other odd markets having similar issues, IMHO, money is best kept in the Anglosphere for now (and has been for a while). UK, Australia, New Zealand, Canada, USA, and perhaps India (need to balance effects of uncontrolled virus vs companies relocating to India out of China).