China abruptly removed the Communist Party chiefs from two of its biggest state-owned financial firms, sparking concerns of a renewed clampdown on the sector.
(Bloomberg) — China abruptly removed the Communist Party chiefs from two of its biggest state-owned financial firms, sparking concerns of a renewed clampdown on the sector.
Luo Xi, 62, will no longer serve as party secretary of the People’s Insurance Co. Group of China, the nation’s largest property insurer said in a statement on its WeChat account Friday, without providing a reason. The announcement came days after online criticism that Luo, who remains chairman of the firm, was building a personality cult when the company demanded employees recite his “golden quotes.”
Separately, Bank of China Ltd. said that the ruling party has removed 61-year-old Chairman Liu Liange as party chief, without providing a reason.
It’s still unclear what prompted decisions, and China often reshuffles senior managers of its largest state-owned financial institutions and heads of government in the run up to its annual legislative conference.
A spokesperson for BOC referred to the company’s statement when reached by Bloomberg for comment. PICC group didn’t immediately reply to a query on Luo’s removal. Both people are below the typical retirement age of 65 for ministerial-level officials in China and no announcements have been made regarding their new jobs.
PICC Group’s life insurance unit posted an internal notice on its Wechat account early this month, requiring all employees to memorize Luo’s quotes before taking a test on them, local media reported. Such moves could easily fuel a personality cult, which the company’s head should have put a stop to, the Economic View, affiliated with state-run China News Service, said in a commentary Feb. 6.
The removals also coincided with news about the disappearance of high-profile banker Bao Fan, which dominated conversations among bankers and tech executives in the absence of any explanation from authorities on Friday.
China’s top procuratorate last month said it’s prosecuting Wang Bin, former chairman of China Life Insurance Co., for alleged bribery and concealed offshore deposits, after putting him under an investigation in January last year.
President Xi launched a broad anti-corruption probe in late 2021 targeting the nation’s $60 trillion financial sector, which has brought down dozens of officials. The probe also implicated the investment banking community, ensnaring bankers from brokerages including Everbright Securities Co. and Guotai Junan Securities Co.
–With assistance from Amanda Wang.
(Updates with background removals and details of PICC incident)
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