Chinese banking regulator Yang Jiacai under investigation for suspected corruption
Yang Jiacai, assistant chairman of China’s top banking regulator, has been placed under investigation for suspected corruption, making him the highest ranking banking regulator to become ensnared in the government’s latest crackdown on financial malfeasance.
The Central Commission for Discipline Inspection said in a statement on Tuesday that Yang, 56, is under investigation for suspected severe violations of discipline, the usual euphemism for corruption.
In line with its usual practice, the top anti-graft watchdog didn’t elaborate further in the statement on its website, nor did it specify whether Yang had been removed from his position as assistant chairman of the China Banking Regulatory Commission (CBRC).
Yang, who took up the post in May 2013, was tasked with overseeing personnel and non-banking financial institutions such as financial leasing companies. He was also director-general of the CBRC general office.
Yang joined the top banking regulatory body in 2003 at its Hubei office. He he previously been with the People’s Bank of China, where he had worked for 15 years.
Yang’s profile was removed from the Chinese language CBRC website within hours of the announcement from the anti-graft body.
Market watchers said Yang’s downfall, following the takedown of top insurance regulator Xiang Junbo in April, showed Beijing’s anti-corruption campaign on the financial industry showed no signs of abating.
“Beijing is escalating its war against corruption in the financial sector as we see senior officials being purged from securities, insurance and banking regulatory bodies,” said Hu Xingdou, a professor of economics at Beijing Institute of Technology.
“Corruption in the financial sector ultimately takes its toll in the broader economy, leaving all walks of life paying the price for rent-seeking in the sector,” Hu said.
Yang’s fall from grace came as no surprise as he was reported to be “out of contact” since April 11 by Chinese media Caixin, just days after the toppling of Xiang Junbo, the former chairman of the China Insurance Regulatory Commission, who was put under investigation on April 9.
The takedown of Yang could be related to irregularities involving loans extended to a real estate developer in Wuhan, the capital city of Hubei province, which was disclosed when Yang Dongping, the former chief risk officer at Bank of Communications, was probed for corruption, Caixin reported in April. The duo were known to have a “close relationship” during the period when they both worked in Hubei.
Yang, a Hubei native, had been working in the central Chinese province for 25 years.
Analysts noted that regulatory oversight of the banking industry had tightened sharply since April.
“So far, the top banking regulator is in high gear inspecting the sector to remove potential risks,” said Chen Shujin, chief financial analyst with Hong Kong-based Huatai Financial. “To handle the top-down inspection, most of banks are carrying out strict self-inspection, suspending new business, and some are overreacting, even causing market turbulence.”