Former Bank of China Chairman Arrested

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Facts

  • On Monday, China's Supreme People's Procuratorate announced the arrest of the former Bank of China chairman, Liu Liange, over suspicions of accepting bribes and giving illegal loans.1
  • This comes a little over a week after Liu was expelled from the ruling Communist Party of China (CPC) and had his qualification as a delegate to the 20th CPC National Congress terminated over alleged violations of regulations, reportedly including abuse of power.2
  • China's Central Commission for Discipline Inspection (CCDI) further claimed that he brought banned publications into the country, accepted entertainment at private clubs and ski resorts, and refused to implement CPC decisions.3
  • The 62-year-old, who had been a prominent figure in China's banking and financial sector, led the state-owned bank from 2019 to mid-March this year, resigning from his position weeks before Chinese authorities announced that he was facing corruption charges.4
  • Liu is the latest high-profile financial executive at state-owned banks to face allegations of corruption. Last month, the former China Life Insurance chairman, Wang Bin, was sentenced to life imprisonment without parole for accepting some $44M in bribes.5
  • A new leadership team was appointed to the CCDI earlier this year, which saw investigations opened into leading Chinese lenders as well as into 30 state-owned industrial giants in a bid to defuse risks and prevent financial contagion.6

Sources: 1XINHUA, 2China Daily, 3The Guardian, 4BBC News, 5Al Jazeera and 6South China Morning Post.

Narratives

  • Anti-China narrative, as provided by The New York Times. Whether allegations against Liu are genuine or fabricated, what's evident is that he's just another prominent figure whom the Chinese regime has made an example of to force loyalty on and consolidate control over the financial system. In addition to this witch-hunt against finance executives, Beijing has also reformed its financial regulatory system to give more power to party officials.
  • Pro-China narrative, as provided by Global Times. Corrupted financial executives at state-owned banks harm the public interest and aggravate financial risks to seek private gains, so it's vital to the stability of the Chinese financial system that authorities resolutely take steps to fight corruption and get rid of rotten apples like Liu Liange once and for all.

Predictions