PBOC Pumps in More Cash After Baoshang Seizure Spooks Market

China’s central bank moved to curb the risk of a funding squeeze on banks after the government’s surprise seizure of Baoshang Bank Co. sparked a jump in borrowing costs.

The People’s Bank of China injected net 250 billion yuan ($36 billion) into the financial system via open-market operations on Wednesday, the most since Jan. 17, following a net addition of 150 billion yuan in the first two days of the week. That’s after the seven-day repo and one-month interbank rate both spiked this week, making funding costs more expensive for financial institutions.