Case Study

ICBC & China Credit Equals Gold No. 1 (B)

3 pages
December 2015
Reference: IMD-7-1765

This case focuses on shadow banking in China, and in particular, on the issue of a product, named the China Credit Equals Gold Trust No.1, with the support of the largest Chinese bank, ICBC. Based on the ‘China Credit Equals Gold’ investment product sold to investors in 2012, the case allows for discussion on Chinese shadow banking pros, cons and linkage to mainstream regulated banking. It also triggers a discussion on Chinese non-conventional investment products.

Learning Objective

Understand: 1) What are the commercial risks and rewards to ICBC in marketing the China Credit Equals Gold Trust wealth management product; 2) What are the systemic risks created by the Chinese shadow banking system; 3) What are the implications of the decision to bail out investors in China Credit Equals Gold Trust No. 1; 4) What are the implications of the China Credit Equals Gold No. 1 case to investors.

Keywords
Banking, Shadow Banking, Deposit, Intermediation
Settings
Asia, China
Industrial and Commercial Bank of China, Finance and Insurance, Banking
2012-2013
Type
Published Sources
Copyright
© 2015
Available Languages
English
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