Regulator Warns Banks about Pooling Wealth Management Funds

(Beijing) – A regulator has vowed to take tougher measures against banks that continue wealth management operations in violation of regulations.

In September 2011, the China Banking Regulatory Commission (CBRC) released a policy requiring banks to stop pooling money from different wealth products and using the funds to invest and repay old loans. The collective management makes it almost impossible to access the performance of each wealth product because gains and losses are shared across the board.