FINANCE

Senior Investment Banker at Guoyuan Securities Probed

Published: Aug. 13, 2024 5:36 a.m. GMT+8

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Owned by provincial government-backed Anhui Guoyuan Holding Group Co. Ltd., Guoyuan Securities is a mid-size brokerage engaging in a full range of financial services

A veteran investment banker has become the latest target of investigators as an anti-corruption crackdown sweeps China’s financial industry.

Wang Chen, assistant to the president and head of the investment banking department at Guoyuan Securities Co. Ltd., has been placed under investigation by authorities and has remained out of contact since July 30, multiple sources told Caixin.

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Wang Chen, head of investment banking at Guoyuan Securities, is under investigation in China's financial industry anti-corruption crackdown.
Guoyuan Securities saw growth in investment banking until 2021 but faced losses in 2023 amid increased regulatory scrutiny.
The investigation into Wang is linked to unauthorized investments and follows probes into other industry figures, including Gao Xin and Cai Yong.

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Who’s Who

Guoyuan Securities Co. Ltd.: Guoyuan Securities Co. Ltd., based in Hefei, Anhui province, is a mid-size brokerage offering a full range of financial services. Established in 2001 and overseen by the Anhui provincial government, it has seen significant growth in investment banking, driven by Anhui's capital market development. However, regulatory scrutiny led to a net loss of 89 million yuan in 2023. The company is owned by Anhui Guoyuan Holding Group Co. Ltd.

Haitong Securities Co. Ltd.: Haitong Securities Co. Ltd. (600837.SH) is mentioned in the article as having a former deputy general manager, Jiang Chengjun, who was investigated due to likely misconduct related to projects sponsored by the investment bank. Additionally, his subordinates, Sun Wei and Sun Yingchen, are assisting with the investigation. The article does not provide further details about the company's broader activities or performance.

Harvest Fund Management: Harvest Fund Management is a leading Chinese mutual fund manager. Its chairman, Zhao Xuejun, was placed under investigation and resigned from the company last week as part of China's intensified anti-corruption crackdown in the financial industry.

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What Happened When

2021：: Guoyuan Securities' net income from investment banking reached 950 million yuan ($133 million), a 52% increase from the previous year, with eight successful IPO sponsorship deals.

In 2023：: Guoyuan Securities recorded a net loss of 89 million yuan.

February 2023：: Cai Yong, founder and former chairman of Guoyuan Securities, was taken into custody for a case related to his brother using Guoyuan Securities’ resources to benefit personal businesses.

By July 30, 2024：: Wang Chen, assistant to the president and head of the investment banking department at Guoyuan Securities Co. Ltd., has been placed under investigation by authorities and has remained out of contact.

Late July 2024：: Jiang Chengjun, a former deputy general manager of Haitong Securities Co. Ltd., was investigated for reasons likely due to misconduct related to projects sponsored by the investment bank.

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