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, Intermediation, Deposit
Settings
China
Industrial and Commercial Bank of China, Finance and Insurance, Banking
2012-2013
Available Languages
English
IMD case studies are distributed through case clearing houses. In order to browse the collection and purchase copies please visit the links below.
Copyright Information
IMD retains all proprietary interests in its case studies and notes. Without prior written permission, IMD cases and notes may not be reproduced, used, translated, included in books or other publications, distributed in any form or by any means, stored in a database or in other retrieval systems. For additional copyright information related to case studies, please contact Case Services.
This case study is part of a series
