China's Huaxia Bank has blamed an employee at a Shanghai branch for selling a wealth management product without permission, after Chinese media said the product could not repay investors, according to Reuters.

The deposit products, issued by the Zhongding Wealth Investment Center, were sold by an employee at Huaxia's Jiading branch, in a Shanghai suburb, Huaxia Bank is reported to have said. The firm did say what position was held by the employee, who has left the bank, nor did it say whether the employee had been dismissed or had left voluntarily.

Huaxia said in a separate statement yesterday that the products the employee sold were four Zhongding-issued instruments, available since 2011, which were backed by returns from a pawn shop and a car sales company in the poor but populous inland province of Henan.

Chinese banks offer proprietary and third-party wealth management products that offer higher investment returns than regular savings accounts to attract and retain wealthy depositors. Typically, each bank generally sells a number of financial instruments it has approved. In most cases, the small print reminds investors that the bank does not guarantee performance.