China's mammoth banking sector will record its first formal bankruptcy case as regulators wind up the debt cleanup at troubled Baoshang Bank, a regional lender at the center of a sprawling financial empire once controlled by fallen tycoon Xiao Jianhua.
Inner Mongolia-based Baoshang will file for bankruptcy as it has been deep in insolvency, the People's Bank of China (PBOC) said in its second-quarter monetary policy report issued Aug. 6. The equity of its original shareholders and unprotected creditors' rights will be liquidated in accordance with law, the central bank said.
