Three Chinese Banks Tumble After Report on North Korea Sanctions

  • Trade war tensions hit three of the biggest Chinese banks on Tuesday, sending their shares down after a U.S. media report suggested they could face fallout from an investigation into North Korean sanctions violations.
  • China Merchants Bank Co., Bank of Communications Co. and Shanghai Pudong Development Bank Co. fell in Shanghai and Hong Kong trading after the Washington Post said that a U.S. judge found three unidentified Chinese lenders in contempt for refusing to comply with subpoenas related to the probe.
  • All three banks said in statements that they were not under investigation for sanctions violations.
  • While the report didn’t suggest any U.S. action against the banks was imminent, the sell-off shows how sensitive investors have become to any indication of a heightening in tensions between China and America. In recent months, news of comments and deliberations by U.S. officials have triggered declines in Chinese stock.

 (Source: Bloomberg)