Three senior Chinese government officials have been reassigned to head large commercial banks, in a move that revives concerns over independence in the financial sector.
Tang Shuangning, vice-chairman of the China Banking Regulatory Commission (CBRC), will be named chairman of China Everbright Group and its subsidiaryChina Everbright Bank, sources confirmed on Thursday.
. Meanwhile Xu Feng, a director at the CBRC, has been named president of the Shanghai Pudong Development Bank, which is 3.8 per cent owned by Citigroup.
Xiang Junbo, deputy governor of the People’s Bank of China, the central bank, was named president of the Agricultural Bank of China, which is currently undergoing restructuring as it prepares to follow competitors such as Industrial and Commercial Bank of China and Bank of China by selling shares to the public.
Everbright Bank and Pudong Development Bank are also preparing for initial public offerings and the new appointments are most likely aimed at ensuring smooth progress for the listings of all three banks.
“Despite ongoing questions over independence in the sector these appointments could actually speed up the restructuring at these banks,” Dominic Chan, director of financial institutions research at CLSA, said.
Wang Mingquan, the current chairman of the Everbright Group, is expected to retire. Fu Jianhua, the current president of Shanghai Pudong Development Bank, will either be demoted to deputy president or leave the bank, according to Chinese press reports.
ABC’s current president is being shifted to become a vice-chairman of the China Insurance Regulatory Commission, in what is essentially a demotion given ABC’s size and importance as the main lender to the country’s rural sector.
China’s banks operate like government departments, with senior managers appointed and removed by the ruling Communist party’s Organisation Department, which is responsible for all senior personnel changes within the government.