The Bank of Qilu has been found to be involved in a massive loan fraud and police in Ji'nan, capital of Shandong Province, is probing into the case, China Business News reported Tuesday.
The bank which changed its name from Ji'nan City Commercial Bank in 2009, began to show signs of abnormal in early 2010. The newspaper said the bank's 2009 financial report made by Price Waterhouse Coopers already indicated some serious problems such as abnormal credit scale of some lenders and illegal deposit pledges.
An insider told the newspaper that the bank didn't take the warning seriously. Because the Price Waterhouse Coopers insisted on writing these problems in the report, the bank changed its auditor.
As the biggest stockholder of the Bank of Qilu, the Commonwealth Bank of Australia said yesterday they had already learned about the case, but said it would not affect its cooperation with its Chinese partners. However, it said it is now more concerned about risk control.
