Evergrande Life Executives Go Missing Amid Probes Into Financial Violations
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Evergrande Life Assurance Co. Ltd.’s office in Xi’an on Jan. 3, 2020.
Evergrande Life Assurance Co. Ltd., the insurance arm of the beleaguered developer China Evergrande Group, is at the center of a new storm as a number of former senior executives have reportedly lost contact during mounting investigations into its financial mismanagement and ties to the collapse of its parent company’s property empire.
Liang Dong, its former chairman, Zeng Songbai, the former general manager, and chief actuary Liu Zhanzhong could not be reached. Caixin learned from sources that several other former executives have been taken away by the authorities.
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- Evergrande Life Assurance, linked to China Evergrande's financial troubles, faces scrutiny with former executives uncontactable and some detained amid investigations into financial mismanagement.
- Evergrande's rapid expansion led to significant transactions funneled into real estate projects, skirting regulatory controls, contributing to a liquidity crisis and subsequent liquidation.
- Executives, including Zhu Jialin and others, are investigated for alleged misuse of funds and obscure dealings, with high-profile convictions related to corruption and improper financial transactions.
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Who’s Who
- Evergrande Life Assurance Co. Ltd.
- Evergrande Life Assurance Co. Ltd., founded in 2015, is the insurance arm of China Evergrande Group. It rapidly grew with significant assets and insurance premium revenue but became a "cash machine" for Evergrande, involved in controversial financial dealings. Investigations revealed it used mutual investments to bypass regulations, significantly contributing to Evergrande's financial issues. The company has been taken over by a state-owned insurer following Evergrande's liquidation amid a liquidity crisis.
- China Evergrande Group
- China Evergrande Group, once the largest developer in China by sales, has been embroiled in a liquidity crisis since 2021. The group faced liquidation after failing to reach a debt restructuring plan with offshore bondholders, resulting in its insurer arm, Evergrande Life, being taken over by a state-owned entity. Investigations are ongoing into its financial mismanagement and regulatory violations, focusing on related-party transactions and property investments.
- Citic-prudential Life Insurance Co. Ltd.
- Before joining Evergrande Life, Liu worked with Zhu at Citic-prudential Life Insurance Co. Ltd. Zhu later moved to Evergrande Life, and Liu followed. Zhu connected Evergrande with China Citic Bank International, a key investor, leveraging his past association to facilitate financial partnerships.
- China Citic Bank International
- China Citic Bank International was involved in Evergrande Life's rapid asset expansion, thanks to Zhu Jialin, who facilitated bridging Evergrande with the bank. Sun Deshun, former president of Citic, was investigated for graft and convicted in 2022 for taking nearly 1 billion yuan in bribes for favorable loans and credits to businesses, including Evergrande. He was sentenced to death in 2023 with a two-year reprieve.
- Zhongrong Life Insurance Co. Ltd.
- Zhongrong Life Insurance Co. Ltd. maintained significant financial ties with the Evergrande Group through its former executive Zhu Jialin. Zhu orchestrated a risky related-party transaction involving a mutual investment with Evergrande worth 4.13 billion yuan. This transaction was facilitated alongside Luo Yuping, the billionaire founder of Zhongrong's parent group.
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What Happened When
- 2015：
- Founded after Evergrande Group bought a 50% stake in a joint venture insurer, Evergrande Life expanded rapidly.
- 2016：
- Liang Dong became general manager of Evergrande Life.
- 2017 to 2019：
- Zhu Jialin led Evergrande Life during its rapid asset expansion.
- 2019：
- Zhu Jialin resigned as chairman of Evergrande Life. Sun Deshun resigned and was later investigated by graft watchdogs.
- By 2020：
- Evergrande Life's insurance premium revenue exceeded 60 billion yuan, and its assets surpassed 240 billion yuan.
- 2020：
- Liang Dong was promoted to chairman, Zeng became general manager, and Liu Zhanzhong left Evergrande Life.
- Since 2021：
- Evergrande has been mired in a liquidity crisis.
- February 2022：
- Sun Deshun was convicted of taking nearly 1 billion yuan in bribes.
- 2023：
- Zhu Jialin was under investigation. Sun Deshun was sentenced to death with a two-year reprieve.
- September 2023：
- Evergrande Life was taken over by a newly created state-owned insurer.
- January 2024：
- A court in Hong Kong ordered the liquidation of Evergrande after it failed to present a suitable debt restructuring plan.
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