China: Minsheng Bank Shares Fall as Chief Resigns
The head of China's largest private lender has resigned amid reports that he faces a corruption probe, sending the bank’s shares tumbling.
On Saturday, China Minsheng Banking Corporation announced that Mao Xiaofeng had resigned as president. According to statements made by the bank to media, Xiaofeng stepped down for personal reasons unconnected to bank operations. However, Caixin and other Chinese media outlets report that Mao had been summoned for questioning by the Central Discipline Inspection Commission, the Communist Party’s anti-corruption agency, a week previously.
The bank’s chairman Hong Qi has been named interim president. Bloomberg reported Monday that Minsheng shares had fallen by as much as 10.5 percent in Hong Kong and 6.6 percent in Shanghai amid the upheaval.
China Minsheng Bank, founded in 1996, is the country's largest private banking institution. As of September 2014, the company owned US $615 billion in assets. Mao, who studied at Harvard, joined the bank in 2002.
President Xi Jinping vowed in January 2013 that under his leadership China would fight "tigers and flies at the same time" – that is, both high and low level officials – in a stringent crackdown on corruption. Recent targets of the anti-graft spree have included corruption in the military and the use of mooncakes as bribery.
The probe has not been without controversy. According to the Associated Press, some of those investigated have claimed that officials obtained confessions from them through the use of abuse and torture. Critics say authorities are allowed to operate outside the normal limits of the state justice system, allowing the process to be shrouded in secrecy. However, Communist Party representatives deny these allegations.