China continues to dismantle missing tycoon Xiao Jianhua’s financial empire

Shenzhen-based Rongtong Fund Management, which manages US$36 billion, has named Zhang Wei as the new chairman

China’s regulator has officially ended its control over New Times Securities, which owns Rongtung, after it took over the Beijing-based brokerage in July 2020

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The China Securities Regulatory Commission’s office in Beijing. The regulator continues to dismantle assets belonging to the Tomorrow Group. Photo: Simon Song

Published: 7:30am, 31 May 2022

Rongtong Fund Management, which was once part of Xiao Jianhua’s Tomorrow Group, has unveiled a management reshuffle, marking its official exit from the missing Chinese magnate’s embattled financial empire.

Zhang Wei was named Rongtong’s chairman on Friday, taking over from Gao Feng who resigned citing personal reasons after seven years in the position, according to a statement issued by the asset management firm.

Zhang is also the chairman of New Times Securities, which owns Rongtung, and was previously in charge of financial management at central government-owned China Chengtong Holdings Group. Chengtong acquired a majority stake in New Times Securities after the government took over the brokerage from Tomorrow Group.

The shake-up at Shenzhen-based Rongtong, a money manager overseeing US$36 billion in assets, is another step taken by China’s regulators to defuse risks in the financial sector by cleaning up Xiao’s sprawling business network spanning from banks and brokerages to asset-management and trust firms.

A file photo of Xiao Jianhua. Photo: Handout

The tycoon, who has not been seen in public since he left Hong Kong for the mainland in 2017, is believed to be aiding the government’s investigation into some high-profile deal-making. The government seized businesses owned by Xiao, who was accused of rampant mismanagement that led several banks into insolvency and disrupted the financial order.

The China Securities Regulatory Commission (CSRC) on Friday said that it had officially ended its control over New Times Securities since taking over the Beijing-based brokerage in July 2020, and allowed it to restart its business.