Economics
U.S. Hong Kong Sanctions Risk $1.1 Trillion in China Funding
- China state banks count on access to U.S. financial system
- U.S. to penalize banks dealing with sanctioned China officials
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China’s largest banks have $1.1 trillion in dollar funding at stake and face potentially steep fines from U.S. legislation that targets penalizing lenders doing businesses with Chinese officials involved in Hong Kong’s controversial security law, according to Bloomberg Intelligence.
The bipartisan measure, which was passed by the U.S. Senate and still needs to go through the House and be signed by the U.S. President, bars financial institutions from providing accounts to sanctioned officials, many of whom may be assumed to use the services of China’s biggest banks, Francis Chan, a senior analyst at BI in Hong Kong, said in a June 30 note. Banks in violation risk being cut off from accessing the U.S. financial system, he said.