BEIJING--China's banking regulator has imposed millions of dollars worth of penalties on two big state lenders for violations in loan issuance and other shadow banking activities.

The China Banking and Insurance Regulatory Commission said Friday that it slapped a 53.16 million yuan ($7.7 million) penalty on Agricultural Bank of China Ltd., the third largest lender by assets in the country, for violations in issuing loans to related parties and malpractices in bankers' acceptances.

The regulator also imposed a CNY39.2 million penalty on China Construction Bank Corp., the No.2 lender, after it found the bank used the proceeds from wealth management products to invest in property projects.

The heavy fines came days before the country's major banks are to report their interim earnings, with the market expecting the largest profit drop in over a decade, as Beijing ordered the country's banks to forgo a total of CNY1.5 trillion in profits this year to help struggling small businesses amid the Covid-19 pandemic. 



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