Ex-BoCom Head Hu Named Party Secretary of China Development BankBloomberg News
Hu Huaibang, the former head of Bank of Communications Co., has been appointed Communist Party secretary of China Development Bank Corp., according to the CDB’s website today.
Hu, 57, will take over from Chen Yuan who remains chairman of the world’s largest policy lender, according to the website.
The change is part of a reshuffle of senior bankers and financial regulators after the annual session of the National People’s Congress last month that saw Xi Jinping named president and Li Keqiang replace Wen Jiabao as premier. Hu’s appointment as CDB party secretary paves the way for him to take over as chairman.
Chen, 68, who took the helm of the Beijing-based lender in 1998, will help set up a new development bank for the BRIC countries of Brazil, Russia, India and China as well as South Africa, Caixin reported April 11, citing people close to CDB that it didn’t identify.
Bloomberg News reported April 12 that Chen would step down, handing the reins to Hu, citing two people with knowledge of the matter. Bocom said in an April 15 stock exchange filing that Hu had resigned as chairman.
CDB is China’s biggest lender in foreign currency, with $248.2 billion in such loans at the end of 2012. It’s also the largest lender to so-called local government financing vehicles that have accumulated at least 10.7 trillion yuan ($1.7 trillion) in debt.
CDB, founded in 1994 and wholly owned by the Chinese government, carries out the state’s policy objectives. Half of the bank’s lending this year will go towards urban development, according to a Jan. 29 notice on its website.
The bank, which had assets last year of 7.37 trillion yuan, is the main funder of China’s oil-for-loans program and a provider of more than $133 billion in lines of credit to the country’s telecommunications, solar and wind companies.
Hu was named chairman of Bank of Communications in 2008. On his watch the Shanghai-based lender reported 20 percent annual profit growth on average, while its assets almost doubled from December 2008 to 5.27 trillion yuan at the end of 2012. The bank also bolstered its capital and deepened cooperation with HSBC Holdings Plc, which owns about 19 percent.
Hu’s appointment may speed up the process of converting CDB into a commercial lender under a restructuring plan approved in 2007.
Di Weiping, a senior adviser to the bank and former head of its Hong Kong branch said last week the future of CDB’s reform is unclear. There is a debate over whether the lender should become a commercial bank or a development bank with commercial operations, he said at a conference in Beijing on April 19.