Chinese bank savers who were prevented from withdraw their money will be able to recover a part of their funds from Friday, regulators announced, following a massive protest over the weekend.
The banking sector in rural China is being hit hard by the central government’s policy to contain the housing bubble and the indebtedness of the world’s second largest economy.
Weakened by the economic slowdown, four banks in the central province of Henan All withdrawals have been frozen since mid-April.
The decision caught thousands of savers off guard and sparked sporadic protests.
One of the largest took place on Sunday outside a local branch of China’s central bank in Zhengzhou, capital of Henan, regarding 600 kilometers southwest of Beijing.
The savers demanded the your money back and accused the authorities of inaction and even collusion with the banks.
Some protesters were beaten by unidentified individuals and forced onto police buses, according to witnesses and photos posted on social media and verified by AFP.
On Monday night, the Henan provincial banking and insurance regulator announced that some savers will be able to get their money back.
Skepticism
Customers with deposits of less than 50,000 yuan (regarding $7,400) will receive their money from Friday, the regulator said in a statement. Payment arrangements for the others will be announced later.
“Funds linked to illegal or criminal (activities) will not be refunded at the moment,” the note added.
The police announced on Sunday the arrest of people allegedly belonging to a criminal organization, which they accuse of controlling several local banks since 2011 and of making illegal transfers through fictitious loans.
However, most aggrieved savers were skeptical on Tuesday regarding the regulator’s announcement.
“People who have more than 50,000 yuan will have to keep waiting forever,” one person wrote in a group chat on the WeChat social network.
Henan banks are part of a larger group of smaller banks affected by liquidity and management problems.
Demonstrations are rare in China, a country where the authorities impose social stability at any price.
However, some Chinese do not hesitate to take to the streets, despite the risk of being arrested. The police are often more tolerant of economic and financial protests than political ones.
Last month, Henan authorities came under fire following allegedly manipulating health passports to prevent aggrieved savers from attending protests.
The health passport is necessary in China to access the vast majority of buildings, shopping malls, public places and some transportation.
“Despite the small amount of assets involved” in the Henan case, “the incident’s social repercussions might be significant if not properly addressed,” ANZ Bank noted in a note.
