China Construction Bank pulls US$3 billion blockchain debt programme amid scrutiny on fintech, financial risks
- Chinese lender has notified the Labuan regulator about its decision to stop the digital bond programme, Fusang Exchange says
- Decision came on the verge of financial breakthrough just as regulators started tightening oversight of fintech risks
The bank, the world’s second-largest lender, “decided not to proceed” with the programme without offering an explanation, Fusang Exchange, a virtual stock exchange for digital initial offerings, said in a statement on Monday.
CCB’s branch in Labuan was the lead arranger and listing sponsor of the digital security to be issued by a special purpose vehicle known as Longbond. The security would have matured in February 2021 and would have paid investors an annualised rate of 0.7 per cent, or Libor plus 50 basis points, higher than returns on the fixed deposit rate, according to a November 11 statement.
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“The exchange has accepted this decision, and is announcing the suspension of the listing with immediate effect,” Fusang said in the statement on Monday. “The exchange shall ensure an orderly withdrawal of all related listing processes and procedures, and has initiated the return of all investors’ funds.”
