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The former head of Bank of China (Hong Kong) was
given a suspended death sentence by a mainland court Friday after being
convicted of embezzlement and receiving bribes.
An Intermediate People's Court in the northeastern city of Changchun sentenced
former chief executive Liu Jinbao to death with a two-year reprieve and
confiscated all of his personal assets, Xinhua News Agency said.
``I think the verdict is a signal to senior management at China's banks,'' said
Stanley Wong, director and deputy general manager at ICBC (Asia). Beijing aims
to clean up its inefficient and debt-burdened banking system, with the biggest
banks planning to sell shares to domestic and overseas investors.
Liu, also a deputy chairman of the Bank of China, was found guilty of embezzling
7.5 million yuan (HK$7.2 million) while taking a further 1.4 million yuan in
bribes. Shenzhen University Law School professor Dong Likun said Liu has two
weeks to appeal against the sentence.
Suspended death sentences are typically commuted to life in prison in China's
murky judicial system.
The court also sentenced two other Bank of China (Hong Kong) executives to
lengthy prison terms. Former deputy chief executive Zhu Chi received 13 years
and was fined two million yuan while former general manager Zhang Deban will
serve eight years and pay a fine of 1.5 million yuan. Both were convicted of
embezzlement.
The trio's downfall began with the bankruptcy of Shanghai Land, to which Bank of
China had lent extensively.
Reforming a banking system still plagued by years of poor lending decisions and
systemic fraud is critical to China's efforts to sustain its phenomenal growth
rate of recent years. The need for change has grown more urgent as the deadline
approaches when foreign banks will be permitted to compete directly with
mainland banks for domestic yuan business.
Liu and his former colleagues aren't the first senior bankers to face
punishment. Chinese courts have also handed out lengthy prison terms to Wang
Xuebing, the former head of Bank of China, and Zhu Xiaohua, the former chairman
of China Everbright Group, for accepting bribes.
tim.leemaster@singtaonewscorp.com
yk.lee@singtaonewscorp.com
gladys.tang@singtaonewscorp.com
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