Top Chinese tech banker’s unexplained disappearance challenges Beijing’s bid to win trust of investors
- The lack of transparency about China Renaissance founder Bao Fan’s whereabouts has sent a chill across China’s private economy
- The unexplained disappearance of Bao could undo efforts by Beijing to win back the trust of investors since ending its rigid zero-Covid policies
Last Thursday, China Renaissance said its board was “not aware of any information that indicates that Bao’s unavailability is or might be related to [its] business”, a polite way of saying that the company had no idea about his whereabouts.
Apart from that statement, information is scarce about the latest status of Bao. Neither Communist Party disciplinary organs nor the police have released any information about the Shanghai-born investment banker. His family has remained silent on the matter.
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Chinese billionaire tech banker Bao Fan reportedly missing, sending Renaissance shares tumbling
According to Chinese media outlet Caixin, the first news organisation to report on Bao’s disappearance, the mogul went missing after Cong Lin, a senior executive at China Renaissance, was taken away by authorities for investigation in September.
Cong was a former chairman of ICBC International Holdings, the investment banking arm of China’s largest state-owned bank.
Caixin’s report, however, did not directly tie Bao’s disappearance to the investigation of Cong. It did not say that Bao was taken away by authorities for questioning, either as a target of investigation himself or to assist in other inquiries. There is currently no evidence to suggest that any allegations have been levelled against Bao.
Without knowing more details, it is impossible to tell if Bao will re-emerge in public after just a few days or weeks, just as some other Chinese tycoons did after they went temporarily incommunicado, or whether he will remain unreachable until his name shows up much later in a state media report. Few people, maybe not even Bao, know at this stage.
More than a few Chinese tycoons who had previously “vanished” were later known to be in the hands of government authorities.
Bao is known as the most successful “matchmaker” in China’s internet service market, having worked on the mergers of Meituan and Dianping into Meituan, Didi and Kuaidi into Didi Chuxing, Ctrip and Qunar into Trip.com, and 58.com and Ganji.com, to name a few.
For sure, no one is above the law, and authorities must have a strong justification if they were to take away anyone of Bao’s status. It is possible that Bao is helping with Beijing’s anti-corruption review into the state banking system. With the changing of the guard in the state financial apparatus, newly appointed cadres may want to clean house, leading to old books being reopened and new questions being asked.
Still, the lack of transparency about Bao’s situation has sent a chill across the private equity field, and broadly, the private sector.
It is a bad story to tell when Beijing is trying to put a friendly face to investors and private entrepreneurs. After all, if a top investment banker can go missing like this with no explanation, putting money into the country’s business sector does not look like such a safe bet.
China’s regulatory crackdown on Big Tech firms from late 2020 had already frightened potential investors away, and the government has been working hard to win back their trust.
The unexplained disappearance of Bao, however, could undo those efforts.
