Agricultural Bank of China Ltd. Chairman Xiang Junbo and China Construction Bank Corp. Chairman Guo Shuqing resigned amid speculation that the government plans to appoint new financial regulators.
Both resigned to do “state financial work,” the two government-owned banks said in separate statements to the Shanghai and Hong Kong stock exchanges yesterday, without giving details. Xiang may be appointed chairman of the China Insurance Regulatory Commission, and Guo the head of the China Securities Regulatory Commission, Reuters reported yesterday, citing three people it didn’t identify.
Naming new personnel at the regulators would be part of the broader leadership changes expected in China over the next 1 1/2 years as the ruling Communist Party selects officials to replace President Hu Jintao and Premier Wen Jiabao. Older leaders will step down from positions in local governments, the military and cabinet ministries.
“This isn’t the first time for this kind of management reshuffle in China’s bureaucracy,” Ronald Wan, a managing director at China Merchants Securities (Hong Kong) Co., said by phone. “From past experience, we know that these finance company heads can actually pick up their new jobs quite fast.”
Liu Mingkang, chairman of the China Banking Regulatory Commission, may be replaced by China Securities Regulatory Commission Chairman Shang Fulin, Reuters said. Jiang Jianqing, chairman of Industrial & Commercial Bank of China Ltd., is also a contender to head the banking regulator, Reuters said.
ICBC and Construction Bank are the world’s two largest banks by market value.
Shares of China’s five biggest banks have dropped an average 16 percent in Hong Kong trading this year on investor concern that bad debts may mount as economic growth slows and triggers defaults by manufacturers, local governments and property developers.
China’s Communist Party held an annual meeting in Beijing earlier this month with top officials seeking to shape the core leadership that will run what may become the world’s biggest economy in the next decade. They aim to mold membership of the nine-person Politburo Standing Committee that will rule collectively under the leadership of Vice President Xi Jinping.
China’s economy, which has overtaken Japan to become the world’s second largest, may surpass the U.S. in size by 2020, according to estimates from Standard Chartered Plc and PricewaterhouseCoopers LLP. Gross domestic product grew 9.1 percent in the third quarter, the slowest pace since 2009.
Auditor, central banker
Xiang was a state auditor and deputy central bank governor before joining Agricultural Bank, the nation’s biggest by number of branches, in 2007 to lead the lender’s restructuring. An initial public offering three years later raised $22.1 billion in the world’s largest first-time sale.
Wu Dingfu, the current head of the insurance regulator, has reached the compulsory retirement age of 65, Reuters said.
Press officials at the three banks and the banking and securities regulators declined to comment on the Reuters report. Three calls to the insurance regulator’s press office went unanswered.