Ex-Bank of China chief sentenced to death


(Gold9472: Well... that's one way to end corruption.)

From Jane Macartney in Beijing

THE former chief of the Bank of China’s Hong Kong division was sentenced to death yesterday after being found guilty of corruption as the communist state tries to restore faith in the banking system.

Liu Jinbao’s sentence was, however, suspended for two years in a move that usually means it will be commuted to life imprisonment.

The case is the latest in a string of scandals in China’s state-owned banks, which are beset by bad loans and corruption just as the country prepares to sell shares abroad.

It comes as institutional investors in Britain have expressed concern about a possible $2.4 billion (£1.34 billion) investment by Royal Bank of Scotland in Bank of China, the country’s second-largest bank by capitalisation and its premier foreign exchange dealing bank.

RBS was reported to be one of four non-Chinese investors poised together to spend $6 billion for a 25 per cent stake.

The sentencing came on the same day that Bank of China’s managing director, Zhang Yanling, said that the lender was pursuing a multibillion-dollar initial public offering by the end of this year or next.

The bank embarked on high-profile reforms last year, after receiving $22.5 billion in state funds to help to clean up its balance sheet.

Liu, who was also a deputy chairman of the Beijing-based Bank of China, was dismissed in May 2003. He was convicted of embezzling 14.3 million yuan (£970,000) along with several others, plus another 7.5 million yuan for himself. Liu also was convicted of taking 1.4 million yuan in bribes.

Three other executives in thebank’s Hong Kong branch were convicted with Liu, the Xinhua news agency said. Liu’s vice-presidents in Hong Kong, Zhu Chi and Ding Yansheng, and executive Zhang Debao received sentences of between 8 and 13 years.