Magang set for profit injection after interest on problem deposits booked

Maanshan Iron & Steel (Magang) will this year book interest income of 'several million yuan' from fixed deposits it has finally been able to recover from banks and non-bank financial institutions, according to officials.

The H share said several banks and non-bank financial institutions had agreed to repay deposits of 339 million yuan (about HK$315.47 million) within three months.

It is understood the People's Bank of China stepped in to help solve the problem.

Magang secretariat official Hu Shunliang yesterday said the H share had not accounted for any interest income arising from the deposits in its 1997 accounts.

'Now that we have retrieved part of the money and are in the process of getting the remainder back, we will be able to book the interest income this year,' Mr Hu said.

'The amount of money will be several million yuan at least.' Officials at fellow H share Dongfang Electrical Machinery, which is pushing ahead with legal steps against China Construction Bank to recover deposits of 156 million yuan, declined to reveal whether it would be making a provision for the frozen deposits.