Recently, there has been widespread speculation on mainland social media about who the corrupt elements exposed after the arrest of Xu Jiayin are, allegedly involving many bank executives suspected of irregularly lending to Evergrande. In September 2021, Evergrande’s funding chain broke, leading to a debt crisis. By the end of 2022, the total debt amounted to 2.44 trillion yuan.
On September 28 last year, it shocked the entire real estate industry when it was officially announced that Xu Jiayin, Chairman of the Evergrande Group, had been subjected to coercive measures for illegal activities. Since then, there have been no further official announcements regarding the progress of Xu Jiayin’s case.
Over the years, Evergrande Group has obtained massive bank loans, ultimately accumulating a debt of over two trillion yuan. The numerous messes left behind after Xu Jiayin’s arrest have yet to be fully exposed. People are curious about the extent of Evergrande’s problems and the involvement of shadowy figures behind the scenes.
Recently, mainland social media reported that Xu Jiayin had disclosed some of the shadowy figures behind the irregular loans to Evergrande, including the former president of HKB Bank. HKB Bank is one of the main sources of funding for Evergrande.
Following Xu Jiayin’s arrest, on December 29 last year, Chen Xinming, former party secretary and chairman of HKB Bank, was placed under investigation. This occurred just six months after Chen Xinming stepped down from his position.
Public information shows that Chen Xinming, born in 1963, previously worked in the Hubei branch of the People’s Bank of China and the Hubei branch of ICBC. In August 2009, he was appointed as deputy director of the Hubei branch of ICBC and then moved to lead HKB Bank, where he served for 14 years.
Official reports indicated that Chen Xinming acted recklessly, engaged in financial misconduct, disbursed loans improperly, embezzled public funds, utilized his position and influence for personal gain in loan financing, and business operations, receiving huge bribes.
Rumors circulating on social media suggest that during his tenure at HKB Bank, Chen Xinming, leveraging his power, irregularly approved loans for real estate companies like Evergrande, receiving substantial kickbacks in return.
It is reported that among those disclosed by Xu Jiayin, there is also Liu Liange, former president of Bank of China. On October 16 last year, it was officially announced that Liu Liange, former party secretary and chairman of Bank of China, had been arrested on suspicion of bribery and irregular loan issuance.
In February of the same year, the state-owned Bank disclosed that Liu Liange had resigned as chairman and was dismissed as party secretary. Subsequently, Liu Liange was announced to be under investigation.
In February of this year, Liu Liange was indicted on charges of bribery and illicit loan issuance. According to the accusation, Liu Liange, in his positions as president of China Exim Bank, Bank of China, and chairman, abused his authority to assist entities and individuals in loan financing, project cooperation, personnel arrangements, illegally accepting a significant amount of bribes, resulting in significant losses, for which he was charged with bribery and illegal loan issuance.
Social media reports suggest that the amount involved in the illegal loans to Evergrande by Liu Liange is staggering, but the exact figures have yet to be fully calculated.
Last year, shortly after Xu Jiayin’s arrest, there were reports from self-media sources claiming that one of Xu Jiayin’s backers was Liu Liange.
With Evergrande’s registered capital at 3.9 billion and debts reaching 2 trillion, there is widespread doubt about how Xu Jiayin could secure such vast sums of funding and cause numerous unfinished projects without the help of many bank presidents and related departments.
It is said that at least hundreds of bank executives and financial institution executives were implicated in the financial black hole of Evergrande. The internal financial system and banks in the country are said to be in a state of panic, with many high-ranking bank executives trembling in fear of being exposed by Xu Jiayin.
According to reports, those implicated by Xu Jiayin include executives from China Exim Bank, office directors, and many vice presidents, executives from Everbright Bank, the former president of CITIC Bank, Sun Deshun, among others.
Sun Deshun, the former president of CITIC Bank, was sentenced to death on November 10 last year in a bribery case and was granted a two-year reprieve before execution. The court stated that Sun Deshun, taking advantage of his positions, facilitated enterprises in loan acquisitions, receiving illegal payments equivalent to over 979.5 million yuan.
Tian Huiyu, the former party secretary and president of China Merchants Bank, was found guilty of accepting bribes totaling 210 million yuan. He was sentenced to death on February 5 this year, with a two-year reprieve before execution. He was accused of exploiting his positions for personal gain through loan approvals and illicitly receiving money from various entities and individuals.
On January 29 this year, the Hong Kong High Court issued a winding-up order to Evergrande, requiring the sale of assets to repay creditors. Evergrande’s debt resembles a massive snow-capped mountain, and it is widely believed that the vast majority will not get back the money owed to them.
Many netizens commenting on the situation believe that Xu Jiayin’s arrest has brought hidden corruption within the banking and financial system to light. The Chinese financial system has long been a hotspot for corruption, which must be eradicated.
Many netizens express concerns that Evergrande’s debt of over 2 trillion yuan includes money owed to ordinary homebuyers, and the numerous unfinished projects left by the company have become nightmares for these buyers.
Data disclosed by mainland media on the number of unfinished Evergrande properties nationwide shows that there are 1.62 million such units, affecting 6 million homeowners.
Responsibility Editor: Gao Jing.