In the past month, a wave of “executive resignation tide” has swept through the A-share listed companies in mainland China, with over 1100 resignation announcements being issued, shocking the outside world. Analysts believe that the Chinese Communist Party is facing a financial crisis, busy with “anti-corruption” efforts to seize money, while executives in the financial industry are collectively resigning in line, aiming to withdraw before the crisis erupts, signaling a prelude to financial collapse.
Since August this year, there has been a surge of “executive resignation tide” in A-share listed companies.
According to Caixin reports, on September 6th,
China Life
, with a total market value of over 400 billion yuan, announced that the board of directors received the resignation of Wang Tingke. Due to job requirements, Wang Tingke resigned from his positions as executive director, chairman of the board, and chairman of the board’s Strategic and Investment Committee, effective from September 5, 2024.
Wang Tingke is not an isolated case. According to incomplete statistics, from August to present, within 27 working days, A-share listed companies have issued over 1100 resignation announcements, averaging 40 per workday.
On August 25th,
Bank of China
‘s vice chairman and president resigned;
on the 18th, Zhang Rongsen, executive director and president of
Zheshang Bank
, resigned;
on the 17th, Wang Feng, deputy general manager of
Jiangyin Bank
, resigned due to work adjustment;
on the 1st, Wu Tiejun, deputy general manager of
Changshu Bank
, resigned due to work adjustment.
In addition, there have been a significant number of resignations from executives of state-owned enterprises. On September 6th, Wang Lixin, executive director and president of
China Tiesiju Civil Engineering Group
, resigned due to work adjustment; on August 28th, Liu Xiaodan, independent director of
China Pacific Insurance
, resigned for work-related reasons; on the 27th, Pan Yanhong, chairman and director of the subsidiary of China Pacific Insurance, resigned; on the same day, Dong Zenghe, director and chairman of
China National Pharmaceutical Group
, resigned due to work arrangement; and director and president Lian Wanyong of China National Pharmaceutical Group also resigned; on the 24th, Lu Jin, chairman of the seventh board of directors of
China National Gold Group
, resigned for personal reasons.
Some companies have seen simultaneous resignations from their chairman, president, and chief financial officer. On August 26th,
Huali Precision Steel
announced that its director and chairman Lu Xu, president Sheng Min, and CFO and vice president Zhang Genhong had tendered their resignations.
Regarding this “executive resignation tide,” American financial scholar Huang Dawei commented to Da Ji Yuan, “On the one hand, many people have made money and are rushing to escape, while on the other hand, many have nothing to do and may have limited income, leading to a contraction in the industry.”
He believes that there are two groups of people rushing to make their exit: the first group has made money and is leaving quickly; the second group comprises those who entered the industry during the boom years but are now experiencing a downturn and are leaving promptly.
However, fleeing abroad is becoming increasingly difficult. Bloomberg recently reported that Beijing is enhancing its supervision of domestic investment bankers. Since August, at least three top investment bankers from different securities firms have been placed under detention by authorities.
Insiders revealed that Haitong and other state-owned securities firms have been requesting many investment bankers to submit their passports and seek approval for all official and personal travel plans. The securities firms have tightened approval for overseas trips and informed employees that even resignations need to be authorized.
Regarding the wave of executive resignations, former legal advisor to the Inner Mongolia government, Du Wen, recently stated on platform X, “I specifically asked some friends in the circle to inquire. The situation of the high-level executives in the Chinese Communist Party’s financial circles now is that many are resigning in line, with many not willing to continue. At some financial institutions, multiple members of the management team have submitted their resignations together. The common reasons for resignation are personal and that the work pressure is too great, or not wanting to delay work. While many are resigning, only a very few have their resignations approved.”
Du Wen pointed out that these resigning executives are well aware of the enormous problems existing within the Chinese financial market. Being at the core of the financial market, they are more sensitive than the general public and can perceive systemic risk signals earlier. As part of the elite group controlling the financial lifeline, they are most sensitive to the market and can detect the deepest crisis signals.
“Behind these resignations, they are trying to absolve themselves of responsibility before the financial market collapses, aiming to avoid becoming scapegoats. This is not just about ‘resigning’ but more like a ‘shirking responsibility’ game—before the crisis erupts, they choose to pass the buck to the next person while they themselves make a clean getaway.”
According to Du Wen’s analysis, when even “their own people” are desperately trying to get away, it suggests that internal power struggles may have gotten out of control, and the chain of interests is collapsing. With everyone fleeing, it indicates that a complete collapse of the financial system is only a matter of time.
Since the beginning of this year, the Chinese Communist Party has intensified its anti-corruption efforts in the financial field. According to incomplete statistics, at least 67 senior financial industry personnel have been investigated this year, with 45 individuals disciplined, making the six major state-owned banks the main battlefield for anti-corruption efforts.
On September 10th, First Financial reported that based on incomplete statistics from the CCDI and the National Supervisory Commission website, among the 67 individuals under investigation, 53 were officials from central-level party and state institutions, state-owned enterprises, and financial units, compared to 48 during the same period last year.
Within the banking system, a total of 23 individuals were investigated, accounting for 34%, with 22 individuals disciplined, accounting for 49%, including 14 expelled from the party and 8 subjected to “double dismissal.” In the financial regulatory system, 10 individuals were investigated, and 5 disciplined. Within the securities sector, as of mid-August, 75 sponsoring representatives from 24 securities firms faced penalties, with the firms receiving 200 penalty tickets.
The anti-corruption efforts in the financial system have been pointed out as a means for the Chinese Communist Party to fill its fiscal deficit. Huang Dawei stated, “The authorities need some money to spend. They have been giving out too much money, and now they need to withdraw those excessive funds. Even grabbing a corrupt official can bring in some money.”
He also mentioned, “The authorities are also trying to rectify this industry to some extent. The corruption is indeed rampant, very exaggerated. Of course, it doesn’t mean that corruption will disappear after this. It will still exist, but at least most officials might be a bit frightened and cautious, possibly leading to some fearfulness.”
“This also reduces systemic risks. If some financial sectors operate in a disorderly manner, it is easy to create a financial bubble, and any irregular fund operations can affect financial operations.”
However, he believes that this kind of rectification in the financial service industry has made everyone cautious, and normal loans and business transactions may be affected, potentially slowing down economic development.
Within the backdrop of the Chinese Communist Party intensifying its anti-corruption efforts in the financial system, the flurry of executive resignations in the financial sector indicates, according to Du Wen, deep-seated corruption and systemic collapse within the Chinese financial system. It reveals that the Chinese financial system has descended into a severe state of internal and external loss of control, indicating that the high-level financial executives have lost confidence in the Chinese financial system, and can even be seen as experiencing deep disappointment in the outlook of the entire national economy.
Du Wen stated that the high positions they once held were dreamed of by many as a coveted “golden rice bowl.” Faced with increasing political pressure and an economic downturn, they understand that the Chinese economy has reached a dead end. Only extremely adverse factors would make these people abandon these highly beneficial positions.
“Most likely, they know that the institutions they are in have become a ‘financial volcano’ that could erupt at any time. Staying in high positions not only does not guarantee safety but could make them the sacrifices of the next round of anti-corruption and investigations.”
“Undoubtedly, this is the beginning of an irreversible systemic financial crisis. China’s economic system is heading towards a deeper abyss,” he concluded.