After nearly one million Chinese people were unable to access their bank deposits in central China’s Henan province earlier this year, residents in east China’s Shanghai, south China’s Shenzhen, north China’s Dandong, and central-east China’s Jiujiang reported the difficulties they faced when trying to withdraw cash from their bank accounts. Some banks only serve a limited number of customers per day, some banks limit each client’s withdrawal to no more than 1,000 yuan and others have closed their branches. Even the ATM machines are empty. Bank runs have been happening in the world’s second-largest economy for over a week, which is unusual in China because most of the banks are state-run. “The reason why the bank run issue hasn’t been solved is that China’s economic system is in crisis and the Chinese regime doesn’t have the ability to solve it,” Wang He, U.S.-based China affairs commentator, told The Epoch Times. Zheng Yongnian, one of the economic advisors to Chinese president Xi Jinping, published an essay on June 1, in which he pointed out that China’s economy is facing critical challenges, including over half of the foreign investments, have left China, and China’s private businesses are struggling for survival due to a supply chain crisis and lack of cash. Zheng’s essay was removed from China’s internet soon after it was published.

Weak supervision, poor risk management and corruption that likely drove the small rural banks in Henan into insolvency are systemic among the country's nearly 4,000 small and medium-sized banks with nearly $14 trillion assets.