Money briefs: China nabs 21 over Ponzi scheme involving $11b

China nabs 21 over Ponzi scheme involving $11b

BEIJING • The authorities have arrested 21 people on suspicion of defrauding around 900,000 people of over 50 billion yuan (S$10.8 billion), state media reported, after a peer-to-peer (P2P) online lender turned out to be a giant Ponzi scheme.

Ezubao offered investors annual returns of between 9 per cent and 14.6 per cent on various projects, the official Xinhua news agency reported - far more than currently offered by Chinese banks' wealth management products.

Ezubao was China's fourth-largest Internet P2P lender, Chinese business magazine publisher Caixin Group said in a previous report.

The firm fabricated most of the projects on its website and paid old debts with money from new investors, Xinhua said. Police raided the firm, based in Anhui province, after discovering its executives were transferring funds and planning to flee, Xinhua added.

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Crisis-hit Nigeria seeks $5b loans for budget

ABUJA • Nigeria's government is in talks for concessionary loans worth US$3.5 billion (S$5 billion) from the World Bank and African Development Bank (AfDB) to help finance a planned record budget this year, Finance Minister Kemi Adeosun said.

However, a formal request has not yet been made to the World Bank for US$2.5 billion and the AfDB for US$1 billion, she said.

The government plans to tie the funds to specific capital projects, she said on Sunday.

President Muhammadu Buhari's government is seeking to spend its way out of an economic crisis triggered by a collapse in oil prices. Nigeria is Africa's biggest oil producer and relies on crude for almost all its exports and two-thirds of government revenue.

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S. Korean shipbuilder posts 71% profit decline

SEOUL • Samsung Heavy Industries, the world's third-largest shipbuilder, saw its operating profit fall 71 per cent in the fourth quarter as declining oil prices led to projects being delayed or axed.

Operating income dropped to 29.9 billion won (S$35.43 million) in the three months to December, compared with 101.7 billion won a year earlier. Sales rose 5 per cent to 3.23 trillion won. For the full year, the company posted an operating loss of 1.5 trillion won.

A foray into rig building has ballooned the debts of South Korea's Big Three shipbuilders - which also include Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering - pushing them into losses. Several shipbuilders and offshore-platform makers in Asia warn of losses amid slumping oil prices.

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A version of this article appeared in the print edition of The Straits Times on February 02, 2016, with the headline 'Money briefs: China nabs 21 over Ponzi scheme involving $11b'. Print Edition | Subscribe