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Bank of Jinzhou Auditors Resign Citing Loan Inconsistencies

  • EY resigned with immediate effect, according to Chinese bank
  • Trading in bank’s Hong Kong shares suspended; AT1 debt plunges
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Bank of Jinzhou Co. said its auditors resigned, sending some of its debt securities plunging and reigniting investor concerns about the riskiness of China’s smaller lenders.

Ernst & Young Hua Ming LLP and Ernst & Young said in a resignation letter to the bank that there are indications that some loans to institutional customers weren’t used in ways consistent with the purposes stated in documents, Bank of Jinzhou said in a statement late Friday. The lender’s shares are suspended from trading in Hong Kong.