Guangfa Bank sees its chairman, president resign as China Life assumes control

China Guangfa Bank announced the resignation of chairman Dong Jianyue and president Li Mingxian after insurance giant China Life assumed defacto control over the Guanghzou-based lender.

The departures came as Citi and China Life formally closed a deal that saw Citi sell a 20 per cent stake in Guangfa to China Life for 19.7 billion yuan. China Life now controls 43.7 per cent of Guangfa’s shares.

The two departing bank executives were believed to have been appointees of Citi. They both issued farewell letters to staff on their last day.

Zhang Fengming will serve as acting president until Guangfa secures regulatory approval for a new candidate.

While congratulating Guangfa staff on the bank’s achievements over his seven-year tenure, including expanding revenues and pre-provision operating profit by 3.6 and 6.5 times in that time, outgoing chairman Dong said he had many regrets, including not being able to help the bank achieve listed status.

“Because of limitations of objective conditions, Chinese-Western cultural differences and the limitation of my own abilities, there was some work that did not meet my expectation. There were gaps in many work areas, there were also many projects that were still ongoing, especially the IPO plan – that after great efforts on our part – did not succeed. I am very upset and regretful every time I get to think about them,” Dong said in his letter that was leaked by mainland media on Wednesday.

Citi’s spokesman in Hong Kong, James Griffiths, declined to comment on the content of Dong’s letter, including the alleged cultural discord, but said; “While we are proud of our decade-long partnership with China Guangfa Bank, this transaction is consistent with the simplification of Citi and allows us to focus our resources in China on growing our core franchise further.