Nov 08, 2021 08:43 PM

Chart of the Day: Corruption at China’s Biggest Policy Bank

China has punished or announced probes into at least nine executives at the China Development Bank (CDB), the country’s biggest policy bank, so far this year as the crackdown on financial sector graft continues.

The latest investigation to be revealed centers around Hong Zhenghua, a former president of the CDB’s Yunnan branch. He is suspected of “serious violation of (Communist Party) discipline and law,” a common euphemism for graft, according to an official statement last week (link in Chinese).

A series of corruption cases linked to the CDB comes as the long-running anti-corruption campaign launched by President Xi Jinping shortly after he took office in 2012 has increasingly focused on financial institutions and regulators in the last few years. A number of financial industry tycoons and regulatory officials have been sentenced to prison, and in one case, death.

Four former senior CDB bankers were punished either by the party or by a court in 2021. Among them, Hu Huaibang, a former CDB chairman, is both the most senior executive in trouble and the most severely punished. In January, he was sentenced to life in prison for taking more than 85.5 million yuan ($13.2 million) in bribes.

In September, the Central Commission for Discipline Inspection (CCDI), the country’s top graft buster, announced its investigation into He Xingxiang, a vice president of the CDB, making him another high-ranking CDB executive in hot water this year.

Several CDB officials were accused of taking bribes to help companies obtain loans. For example, Hu had helped CEFC China Energy Co. Ltd. and HNA Group Co. Ltd. obtain billions of dollars in dubious credit, Caixin previously reported. Energy giant CEFC later collapsed amid corruption investigations and scandals. Aviation conglomerate HNA is now undergoing a bankruptcy restructuring.

Besides the CDB, China’s other two policy banks — the Export-Import Bank of China and the Agricultural Development Bank of China — also saw officials punished for corruption this year.

Meanwhile, at least eight senior managers at the country’s four largest commercial banks have been brought down by anti-graft probes, said a September CCDI statement (link in Chinese).

There have long been too few checks on the power of financial institutions’ leaders, especially their power over credit approvals, according to an article (link in Chinese) published by the CCDI in September. “Corruption in the financial sector … is highly contagious, which could not only lead to risky events in the financial firms, but also reduce the efficiency of market resource allocation and result in systemic risks.”

Anti-corruption officials have recently kicked off a fresh round of inspections into the country’s 25 major financial regulators and institutions, including the CDB.

Contact reporter Guo Yingzhe ( and editor Joshua Dummer (

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