Another banker caught in ABC graft probe's net
A corruption investigation involving Agricultural Bank of China (ABC), one of the mainland's Big Four state-controlled banks, has implicated a smaller Chinese bank and threatens to ring in more mainland lenders and property developers.
An official at second-tier lender China Minsheng Banking, He Juxin, has been detained by police in Beijing - in connection with the case of an ABC executive vice-president suspected of corruption and illegal gambling, sources say.
A spokesman for Minsheng Bank in Beijing said yesterday that he had no knowledge of He's case. But a source close to the matter said the bank's senior executives had been informed of He's detention.
He was general manager of brand management, people who were briefed on the matter said.
He's arrest late last month came at the same time that ABC top brass Yang Kun was detained in Beijing by the Central Commission for Discipline Inspection, the party's internal anti-corruption arm.
Both bankers are believed to have close personal ties to another businessman detained in the corruption probe, Wang Yaohui, chairman of the secretive and closely-held property-to-resources conglomerate Zhonghui Guohua Industry Group.
It is unclear if Yang and He have any direct personal connection.
'With the development of the investigation, I can assure you that you will see more big fish caught. This is not a small case, but a very big deal,' said one source, adding that the low-profile Wang had a large network of bankers and officials in Beijing.
Two people in the mainland's financial industry told South China Morning Post that the cases came to Beijing's attention after the anti-corruption central commission received a complaint from an anonymous source earlier this year about Yang's gambling and misuse of Agricultural Bank of China funds.
Yang is responsible for real estate loans at the company.
At about the same time, Minsheng Bank also received a formal complaint about He's alleged involvement in corruption. If ABC's Yang is proven to have been involved in illegal activities, it would mark the highest-profile case involving a Big Four banker since the state-owned banks started going public in 2005.
The detention of Yang was confirmed by ABC in a stock filing on Wednesday. Yang, considered a rising star in the banking industry, is known for being a fan of gambling, particularly poker and mahjong.
People with knowledge of the matter interviewed by the Post described Yang's case as potentially as serious as that of former Bank of China (Hong Kong) chief executive Liu Jinbao in 2003.
Liu had been caught up in an anti-corruption investigation at that time and in 2005 was sentenced to death. The sentence, however, was suspended for two years, which means Liu is likely to serve a long jail sentence instead.
Minsheng Bank's He served in the PLA before he joined the second-tier bank. He used to be a mid-level executive at Minsheng Bank's Shanghai branch before being promoted to more senior positions at the bank's head office, according to people who worked with him.
In addition to He's official title at Minsheng Bank as its top executive in charge of brand and marketing, He is also the director of the Minsheng Art Museum, which was established and funded by the lender to collect and exhibit valuable artworks.
According to people who know about their business dealings, He and Zhonghui Guohua chairman Wang share an interest in art.
They also said Wang, with Yang's help, obtained loans from Agricultural Bank of China to shore up some money-losing property projects in Beijing, and to finance the businessman's personal hobbies, including buying artworks and gambling.
Additional reporting by Jane Cai in Beijing
Yang Kun, ABC executive vice president, is under investigation related to the gambling activities of a Beijing property entrepreneur.
Two ABC Shanghai sub-branch managers arrested for allegedly illegally gathering deposits of 270 million yuan and lending the money to a property developer at a monthly interest rate of between 5 and 9 per cent, according to mainland media reports.
A manager of ABC's Jiangyin sub-branch fled the country with his entire family after allegedly stealing more than 300 million yuan.
Mainland media report that two directors of ABC's Xuzhou sub-branch were involved in a discounted bills fraud that incurred a loss of 160 million yuan
Caixin reported that ABC's Inner Mongolia branch was gathering illegal deposits.
Source: Bank of America-Merrill Lynch