Shares in China’s privately run banks have fallen sharply this year, as the country’s property slowdown starts to bite, the Wall Street Journal reported. The Shanghai-listed shares of China Merchants Bank and Ping An Bank Co.—two of China’s biggest, most prominent privately run lenders—have fallen by 32% and 25%, respectively, since the start of 2022, wiping $68 billion off their combined stock market value. The selloff is just the latest indication of the problems a slowdown in the property sector is having on the wider economy.

Authorities in central China on Monday announced the arrests of 234 people involved in a scam to bilk people out of their savings with the false promise of high interest rates on deposits in obscure rural banks, the Associated Press reported. The scandal drew national attention after investors seeking answers about where their money went were prevented from reaching the Henan provincial capital of Zhengzhou when the health status displayed on their mandatory COVID-19 cellphone apps was suddenly changed to red, preventing them from traveling.

There was much relief for investors in U.S.-listed Chinese firms after Beijing and Washington struck a long-pending audit deal, but legal experts and China watchers warn the two sides could still clash over how the accord is interpreted and implemented, Reuters reported. U.S. regulators have for more than a decade demanded access to audit papers of U.S.-listed Chinese companies, but Beijing has been reluctant to let U.S. regulators inspect its accounting firms, citing national security concerns.

China's central bank has stepped up pressure on lenders with new instructions to grow loans, six bankers with knowledge of the matter said, as the world's second-biggest economy faces an economic downturn and a plunge in borrowers' confidence, Reuters reported. The informal message, issued via phone calls over recent months to commercial, rural and even foreign banks, was to lend more money to productive businesses and put less of it in financial investments, the banking sources said.

China's banking and insurance regulator has agreed in principal to allow two rural banks in Liaoning Province to enter bankruptcy proceedings, according to an official statement released on Friday, Reuters reported. The two banks are Liaoyang Rural Commercial Bank Co., Ltd and Liaoning Taizihe Village Bank Co., Ltd, the China Banking and Insurance Regulatory Commission said. Read more.

China's unemployment insurance payouts hit a record high in June, adding to signs of a struggling labour market as the economy has been badly hit by COVID-19 outbreaks and a property crisis, Reuters reported. Payments by China's unemployment insurance fund jumped 256.6% in June from a year earlier to 37.19 billion yuan ($5.42 billion), according to Reuters' calculations based on data from the Ministry of Human Resources and Social Security. That was the highest since the data series began in January 2013.

China's foreign exchange regulator phoned several banks on Wednesday to warn them against aggressively selling the Chinese currency, people with direct knowledge of the matter said, in a new sign of official discomfort with recent yuan weakness, Reuters reported. The Chinese yuan has been dropping against the dollar, and market participants said the telephone calls suggested authorities may be getting uncomfortable with the speed of the slide. The yuan jumped to 6.8605 per dollar in offshore trade after Reuters published news of the calls.

Cash-strapped Chinese developer Shimao Group has proposed a two-class restructuring plan to offshore creditors to repay $11.8 billion over a period of three to eight years, according to two sources with direct knowledge of the matter and a document seen by Reuters. Shanghai-based Shimao, which first missed a public offshore bond obligation last month, is the first major Chinese developer to kick off negotiations on restructuring terms with creditors.

For all the talk in Western capitals of reducing reliance on Chinese factories, China has in the past two years consolidated its position as the world’s dominant supplier of manufactured goods, the Wall Street Journal reported. Though some of China’s gains in global markets may unwind as the effects of the pandemic fade, the trend nonetheless highlights just how hard it is to unplug from the world’s largest factory floor.

China cut its benchmark lending rates on Monday, adding to easing measures announced last week, as Beijing steps up efforts to spur credit demand in an economy hobbled by a property crisis and a resurgence of COVID infections, Reuters reported. The one-year loan prime rate (LPR) was lowered by 5 basis points to 3.65% at the central bank's monthly fixing, while the five-year LPR was slashed by a bigger margin of 15 basis points to 4.30%. In a Reuters poll conducted last week, 25 out of 30 respondents predicted a 10-basis-point reduction to the one-year LPR.