November 04th, 2008 | Caijing Magazine Financial Crisis: Impact on China
How much money have Chinese financial institutions lost to date in the ongoing financial crisis?
Q: How much money have Chinese financial institutions (banks, funds, investment vehicles) lost to date in the ongoing financial crisis?
A: The following are the present reports of losses of Chinese financial institutions, as much as we can find.
Bank of China: As of September 2008, Bank of China held US$ 3.274 billion of U.S. sub-prime mortgage-backed securities, US$ 1.379 billion in Alt-A mortgage-backed securities, and $4.337 billion of Non-Agency mortgage-backed securities, for a total of US$ 8.99 billion.
China Construction Bank: As of September 2008, the bank held US$ 244 million of U.S. sub-prime mortgage-backed securities, US$ 191 million of Lehman Brothers-related debts, and US$ 1.512 billion of securities connected to Freddie Mac and Fannie Mae. It is preparing to write down US$ 673 million.
Industrial and Commercial Bank of China: As of September, US$ 1.207 billion of U.S. sub-prime mortgage-backed securities, US$ 605 million of Alt-A mortgage-backed securities, US$ 55 million in structured securities, for a total of US$ 1.867 billion.
China Merchants Bank: The bank has sold off all its Freddie Mac and Fannie Mae mortgage-backed securities, earning a small profit; however, it still owns US$ 70 million of Lehman Brothers-related debts. They possess no more sub-prime mortgage securities.
China Investment Cooperation: The bank’s investment loss is estimated between US$ 40 million and US$ 80 million by its investment in Reserve Primary Fund, which was affected by Lehman Brothers’ bankruptcy. CIC also suffers from losses on Blackstone and Morgan Stanley.
Ping An Insurance Group: Losses have reached 10.5 billion yuan due to its Fortis Group holdings.
China Development Bank: The bank owns 1,500 million shares of Baclays Bank. They bought in at 7.2 pounds per share, a price that has now dropped to 3.3 pounds per share.
State Administration of Foreign Exchange’s investment losses in WAMU is unknown.