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China’s bank regulators take over Baoshang Bank, moving a step closer to breaking up financier Xiao Jianhua’s business empire
- The People’s Bank of China (PBOC) and the China Banking and Insurance Regulatory Commission (CBIRC) have taken over the management of Baoshang Bank for two years, according to a joint statement
- China Construction Bank will assume the daily operations of Baoshang to protect the interests of customers and depositors, the regulators said
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Zhang Shidongin Shanghai
China’s central bank and banking regulator have taken over control of a commercial lender linked to disgraced financier Xiao Jianhua, as the authorities take a step forward in breaking up his sprawling business empire.
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The management of Baoshang Bank, based in Inner Mongolia’s Baotou city, was taken over by the People’s Bank of China (PBOC) and the China Banking and Insurance Regulatory Commission (CBIRC) with immediate effect for a year to contain its credit risk, according to a Friday statement by the two regulators.
China Construction Bank, one of the country’s biggest state-owned lenders, was entrusted with taking over Baoshang’s daily banking operations to protect the interests of depositors and customers after control of its management was assumed by the regulators, according to the statement.
Baoshang is a key piece in Xiao’s business empire, which holds stakes in hundreds of Chinese listed companies via proxies, spanning energy, financial services, technology and real estate, among a myriad of industries.
The Chinese authorities have been trying to carve up his business interests ever since Xiao left Hong Kong in January 2017 on the eve of the Lunar New Year for mainland China, where he is believed to be helping with one of the biggest investigations into deal making. Xiao has not been seen in public since, and is awaiting trial on charges of bribery and manipulating stock prices.
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