SHANGHAI (Reuters) – Kaixin Financial News reported on Sunday that the total losses from a structured product for investing in crude oil marketed by the Bank of China among individual investors could exceed nine billion yuan ($ 1.27 billion).
Quoting financial sources, she said that more than 60,000 investors participated in the program, losing deposits amounting to 4.2 billion yuan. A third of the total invested more than 50,000 yuan each.
The Bank of China “Bao” sells crude oil to individual investors and is bound by domestic and foreign futures contracts, including West Texas Intermediate and Brent.
last week after West Texas contract prices fell to zero for the first time, closing at minus $ 37.63 a barrel as dealers paid money to get rid of their oil.
Kaishen said that the bank had credit positions between 24 and 25 thousand, equivalent to one thousand barrels, which resulted in an estimated loss of 5.8 billion yuan.
On Friday, the bank said it was “deeply disturbed” by the losses suffered by its investors, and blamed the fluctuations in the global oil market for the Corona virus pandemic.
($ 1 = 7.0813 Chinese yuan)