Behind the earthquake in Shanxi's financial system: the hidden morality system

  China News Weekly reporter/Su Jiede

  Taixin Business Building A, Yingbin West Street, Development Zone, Jinzhong City, Shanxi Province, is a slightly outdated low-rise business building.

On the second floor, a black seal on a white background is obliquely attached to the glass door.

In the past few years, here has been the headquarters of the German imperial family that has mastered the domestic and foreign capital markets: the actual controller Tian Wenjun has successively controlled many listed companies at home and abroad, and the stock price of one of the US stock companies has soared 45 times, shocking Wall Street, and the German imperial family has also become famous. .

  Now, after Longyue Industrial, a Deyu company, has been seized, another piece of Tian Wenjun’s business map has been revealed: since 2013, Tian Wenjun’s Deyu companies have successively invested in two local city commercial banks, including Jinzhong Bank and Yangquan Commercial Bank. , And at least eight local rural commercial banks.

With so many shares in banks, locals laughed and called him the "President".

This "president" has a lot of energy, which has brought huge bad debts to the banks that he bought shares, and even disrupted Shanxi's financial system.

  On July 20, the official website of the Central Commission for Discipline Inspection revealed that Zhang Anshun, former party secretary and director of the Shanxi Supervision Bureau of the China Banking Regulatory Commission, was suspected of serious violations of discipline and law and is currently undergoing disciplinary review and supervision and investigation.

On July 19, the former party secretary and director (director) of Shanxi Provincial Local Financial Supervision Administration (Provincial Government Finance Office) was investigated on suspicion of serious violations of discipline and law.

  Not only was the main person in charge of the supervisory department down, four persons in charge of the Shanxi Rural Credit Cooperative Union, which has assets of more than one trillion yuan, were also intensively investigated-including the former party secretary and chairman Cui Lianhui, the former party committee deputy secretary, vice chairman, Director Xing Liangxi, former full-time deputy secretary and vice chairman of the party committee Wang Zhongze, and former party committee deputy secretary Wang Zaisheng.

  The above-mentioned period when the decommissioned officials were in power was the period when the Deyu Department intensively invested in the banks, and these banks became the hematopoietic machines for the capital market.

The chaos behind the "run" storm

  As early as June this year, some clues of Shanxi's financial crisis began to emerge.

  At that time, Yangquan Commercial Bank had a storm of centralized withdrawal of deposits by some depositors.

After the "run" incident, in order to calm the situation as soon as possible, the local people's government, the local People's Bank of China, the China Banking and Insurance Regulatory Bureau, and the Yangquan City Commercial Bank all posted announcements.

On the afternoon of June 17, a netizen posted an online video on Weibo. Huang Haitao, the deputy mayor of Yangquan, said to the gathered local people, “Yangquan Commercial Bank is now operating normally and has sufficient funds. I use my identity as the mayor and my personality. , Party spirit guarantees everyone."

  A person who had business dealings with Yangquan Commercial Bank introduced to China News Weekly that the reason for the run was related to the successive investigations of the then chairman Li Shouming and the president Zhao Jiantao.

After that, Yang Huixin, the former chairman of Shuozhou Rural Commercial Bank, became the new chairman of Yangquan Commercial Bank.

However, not long after Yang Huixin took charge of the work, he was also investigated.

In late June this year, Wang Zhenyun, Director of the Accounting and Finance Department of the Taiyuan Central Branch of the People's Bank of China, was appointed as the President of Yangquan Commercial Bank.

According to the staff of the local supervisory department, there are several "firefighters" like Wang Zhenyun.

  The predecessor of Yangquan City Commercial Bank was Yangquan City Credit Cooperative, which was formally established in September 2007.

According to the "2018 China City Commercial Bank Development Report", city commercial banks carry a heavy historical burden.

For example, city commercial banks are limited by their size and historical background, and are less reliable in the minds of customers. Once rumours of bankruptcy or credit crises occur, a large number of customers will concentrate on bank withdrawals, causing frequent runs and liquidity risks.

  The current crisis of Yangquan Commercial Bank is closely related to the German Imperial Family.

In 2016, Yangquan Commercial Bank introduced strategic investors to speed up risk management.

As of the end of 2016, the top four shareholders of Yangquan Commercial Bank Longyue Industrial, China Coal Xingyuan (Beijing) Technology Co., Ltd., Shanxi HSBC Investment Co., Ltd., and Jinzhong Xinkeyuan Agricultural Trade Co., Ltd. held 11.17% of the shares, the fifth largest The shareholder Yangquan Coal Industry Group holds 10.77% of the shares, and the sixth and seventh largest shareholders, Shanxi Bairui Electronic Technology Co., Ltd. and Heyou Industry, respectively hold 5.59%.

  What attracts the most attention is that the shareholders of this capital increase are closely related to the Deyu Family, and it has also completely changed the equity structure of Yangquan Commercial Bank since the reorganization of the urban credit cooperative.

Among the top seven shareholders, four belong to the German imperial family, holding a total of 33.52%.

The other three shareholders, in addition to the state-owned Yangquan Coal Industry, the other two companies also have close ties with the Deyu Department-the actual controllers of Shanxi HSBC Investment Co., Ltd. and China Coal Xingyuan (Beijing) Technology Co., Ltd. are Zhao Guohao.

  A former director of Yangquan Commercial Bank told China News Weekly that the reason why Tian Wenjun was able to take a stake in Yangquan Commercial Bank was inseparable from the recommendation of Zhao Guohao.

Shanxi HSBC Investment Co., Ltd. became a shareholder of Yangquan Commercial Bank in 2007, and Zhao Guohao has been a director of the bank since then.

In 2014, Eden City Commercial Co., Ltd. was established. The sponsoring shareholders were China Coal Xingyuan and Deyu Longyue Industrial, which were actually controlled by Zhao Guohao.

  "In the past, Tian Wenjun followed Zhao Guohao, but then Tian Wenjun started business, and Zhao Guohao started doing business with Tian Wenjun." The above-mentioned director said that after Deyu became a shareholder of Yangquan Commercial Bank, Deyu once wanted to change bank management on a large scale, but the supervisory department No approval.

The second best thing is to arrange for one's own person to actually participate in bank work.

An address book of the Yangquan Commercial Bank shows that Zhao Guohao was the vice chairman of Yangquan Commercial Bank at the time. Among the six directors and supervisors, the names of Wei Kun and Li Haijiang also appeared on the employee list of the German imperial family.

  “In the past, the board of directors, the board of supervisors, and the management team were separated from the three powers. They all performed their duties. The board of directors proposed plans, the operation was responsible for implementation, and the board of supervisors supervised. Later, it was not. The party committee had the final say in issuing loans, for example. When it is necessary to sign, an enlarged meeting of the party committee will be held." A former shareholder of Yangquan Commercial Bank told China News Weekly that the bank was operating well before 2014 and distributed dividends to shareholders every year. No more dividends.

  The former director told China News Weekly: "When the former chairman was in office, he had to go to the board of directors for a loan of more than 10 million yuan. The directors knew who the loan was made. The style of the successor chairman changed and some proposals were obviously unreasonable. Disagree and kick me away."

  Governance was out of control, and Yangquan Commercial Bank became the ATM of the Deyu Department.

According to Caixin reports, as of the end of September 2019, Yangquan Commercial Bank had actual non-performing assets of 5.417 billion yuan, a NPL ratio of 25.24%, a provision coverage ratio of 16.02%, a capital adequacy ratio of -5.52%, and a capital gap of 5.215 billion yuan.

The bank granted 5.036 billion yuan of credit to Longyue Industrial, and its credit balances to Tunghsu Group, Rendong Holdings and ECCOM Ark were 4.896 billion yuan, 6.345 billion yuan and 1.4 billion yuan respectively, totaling 17.677 billion yuan, nearly 5 billion yuan overdue .

Routines in the 1.5 billion yuan trust case

  The financial turmoil caused by the German Imperial Family continued to ferment. In July of this year, the 1.5 billion yuan trust case of Shanxi Lucheng Rural Commercial Bank (hereinafter referred to as Lucheng Rural Commercial Bank) surfaced, confusing, and pushed the German Imperial Family to the front.

  “Recently learned from relevant media that the company may be involved in a dispute over a financial loan contract.” On July 7, Rendong Holdings announced that the company learned about the prosecution after it extracted the complaint from the Guangzhou Intermediate People’s Court and related information about the company.

Rendong Holdings has been a dark horse in the A-share market in recent years. Its main business covers financial sectors such as third-party payment, commercial factoring, and supply chain management.

  Previously, Lucheng Rural Commercial Bank took 7 companies including Rendong Holdings and 3 natural persons to court, and demanded Rendong Holdings to bear joint guarantee liabilities for 1.5 billion yuan of debt, and pay interest, value-added tax and surcharges of approximately 1.55. 100 million yuan and other compensation.

  The premise of this lawsuit is that in October 2017, Lucheng Rural Commercial Bank subscribed for a trust plan established by Daye Trust, with a subscription amount of 1.5 billion yuan, expected annualized income of 8.5%, and a trust period of one year.

The asset management plan was actually invested in Jinzhong Yujia Grain and Oil Trading Co., Ltd. (hereinafter referred to as Jinzhong Yujia) to supplement its working capital.

The contract was signed on October 18, and Daye Trust issued a first-phase trust loan of 980 million yuan to Jinzhong Yujia on the next day, and the second-phase trust loan of 520 million yuan was also credited within a week.

  Compared with the speed at the time of loan issuance, the road to repayment is tortuous and long.

After the expiration of the one-year contract, Jinzhong Yujia failed to repay the loan on time.

On October 18, 2018, Daye Trust and Lucheng Rural Commercial Bank signed a supplementary trust contract agreement, and the trust period was revised from one year to two years.

In December 2019, Daye Trust signed a debt transfer and trust termination agreement with Lucheng Rural Commercial Bank, transferring its trust loan principal of 1.5 billion yuan, interest, and liquidated damages to Lucheng Rural Commercial Bank. .

  This year, Lucheng Rural Commercial Bank initiated a lawsuit against the lender and the guarantor on the grounds that Jinzhong Yujia failed to repay the principal and interest of the loan as scheduled.

Among them, the listed company Rendong Holdings has issued a letter of guarantee to provide joint liability guarantees for the above-mentioned asset management plan. The guarantee letter bears the personal seal of Yan Wei, the original official seal of Rendong Holdings "Minsheng Jinke Holdings Co., Ltd." and the timely legal representative of Yan Wei .

  Regarding this lawsuit, Rendong Holdings cried out injustice, "Before learning of this lawsuit, the company did not know the above financial loan contract and guarantee. The debtor Jinzhong Yujia mentioned in the litigation materials was investigated by the company and was not our company. The holding company directly or indirectly does not have any equity or controlling relationships or transactions with the company.” Rendong Holdings stated in the announcement that it had no knowledge of the matter and had already reported the case to the public security organs.

  In fact, when this 1.5 billion yuan trust contract occurred, the controlling shareholder of Rendong Holdings was still a Deyu enterprise.

Tianjin Heyou Technology Co., Ltd. (hereinafter referred to as Heyou Technology), which is also the defendant, was its controlling shareholder from April 2016 to March 2018, and the actual controller of Heyou Technology is Tian Wenjun’s wife, Hao Jiangbo.

  More importantly, the Deyu Group also participated in Lucheng Rural Commercial Bank.

Heyou Industrial Co., Ltd. controlled by Hao Jiangbo holds a 7.92% stake in Lucheng Rural Commercial Bank.

Longyue Industrial Group Co., Ltd. (hereinafter referred to as Longyue Industrial) also held a 7.5% stake in Lucheng Rural Commercial Bank.

Another Deyu company-Jinzhong Jinsheng Agricultural Development Co., Ltd. still holds 9.67% of Lucheng Rural Commercial Bank shares. The three companies together hold more than 25% of Lucheng Rural Commercial Bank shares.

Although these three companies have no equity relationship, a list of German and Imperial companies obtained by China News Weekly shows that these three companies are all listed.

  In this 1.5 billion yuan trust contract, the Deyu Department played the three roles of lender, guarantor and borrower, which is equivalent to lending itself to itself.

Since then, the Deyu Department encountered a debt crisis. In 2018, it transferred the controlling rights of Rendong Holdings to Rendong Group. The person in charge of the company is Huo Dong, the son of Huo Qinghua, the former richest man in Inner Mongolia.

In 2019, the controlling interest of Rendong Holdings was transferred to Haidian State-owned Assets Platform.

  The control of the listed company beats the drum and spreads flowers, and the new shareholders do not recognize the old accounts.

"According to relevant laws and regulations, this guarantee letter is an invalid guarantee." Rendong Holdings believes: "Our company does not have all the original contracts and guarantee letters mentioned in this case, and has not contacted or signed the above documents. There is no relevant printing process, no relevant review procedures for the board of directors and general meeting of shareholders, and independent directors have not expressed independent opinions."

  When a war of words broke out among the lending parties, the capital chain of Yujia in Jinzhong was broken.

"China News Weekly" obtained a document signed on May 13 this year, showing that Jinzhong Yujia had loaned 73.5 million yuan from the Taiyuan branch of Minsheng Bank and needed to return the bank's 300,000 yuan of loan principal every month.

The company said that due to the impact of the new crown epidemic, operating difficulties, and tight funds, it has continuously overdue repayments since February this year.

  The above information shows that in December 2013, Jinzhong Yujia made an advance of 16.5 million yuan for the Minsheng Bank Taiyuan branch to solve the problem of non-performing loans. At that time, the agreement stated that the Minsheng Bank Taiyuan branch would pay the company an annual interest of 18%.

Now, Jinzhong Yujia requires the bank to repay the principal and corresponding interest, and the company repays the Minsheng Bank loan as required.

Road to Zhuangzhuang

  The litigation of Lucheng Rural Commercial Bank unveiled the typical capital operation routine of the Deyu family: First, it obtained control of a listed company, changed its main business through foreign investment or mergers and acquisitions, and changed the name of the listed company, prompting the company’s stock price to skyrocket. Deyu seized the opportunity to reduce its shareholding or pledge it to obtain more financing.

  In December 2014, the listed company Qixing Tower (now known as Beixun Group) announced that Longyue Industry acquired part of the company’s shares for 880 million yuan and became the new controlling shareholder. Qixing Tower became a domestic A share of Deyu The first listed company.

  On the day of the acquisition, Qixing Tower received a notice from the new owner to plan a major asset restructuring, and the company's shares were therefore suspended.

In July 2015, Qixing Tower announced a plan to acquire Beicom Telecom through private placement of 6.3 billion yuan.

Until April 2017, the acquisition finally landed and Qixing Tower was renamed Beixun Group.

In this fixed increase, Longyue Industrial's subscription amount exceeds 2 billion yuan.

  Do the same.

In December 2015, another listed company Rendong Holdings (formerly known as Honglei shares and Minsheng Jinke) planned an asset reorganization, and Hao Jiangbo became the actual controller of the company.

A few months later, Rendong Holdings intends to acquire some assets for 2.31 billion yuan to deploy third-party payment business and credit card consumer services.

  Not only the domestic capital market, the Deyu Department has operated earlier in the foreign capital market.

In 2010, under the operation of Tian Wenjun, Deyu Agriculture was listed on the US stock market, and Deyu Department officially entered the capital market.

Five years later, Deyu's Wensheng Finance also landed in the United States, and its stock price rose from about $10 to a maximum of $465, an increase of 4500%. The skyrocketing market shocked Wall Street.

This year, the company failed to submit its 2019 financial statements within the specified time and received a warning letter and delisting letter from Nasdaq.

At present, the company needs to provide the latest information on the company's audit for the previous year as of June 30, 2019 before September 18 to determine whether it can continue to be listed on the Nasdaq.

  Multi-line warfare, with billions of dollars of funds at every turn, where does the money from the Deyu Department come from?

From the perspective of timeline, while the Deyu Department laid out listed companies, it also invested a large number of local commercial banks. These banks became the hematopoietic machinery of the Deyu Department.

  "The real industry of the Deyu Department is not large. Without the support of financial institutions, they cannot win several listed companies at the same time, let alone spend more money for asset restructuring." A person familiar with Shanxi's capital market Tell "China News Weekly."

  Since 2013, Deyu Group, represented by Heyou Industrial and Longyue Industrial, has intensively invested in more than 10 local Shanxi banks.

  According to the information obtained by "China News Weekly", in April 2013, Heyou Industry subscribed for 40 million shares of Jinzhong Bank at a price of 2 yuan per share, and Tian Wenjun also became a director of this commercial bank; in 2014, from Yangquan City, Shanxi Two shareholders of Yuxian Rural Commercial Bank purchased more than 10% of the equity; acquired 20 million shares of Shouyang Rural Commercial Bank at a price of 2 yuan per share; September 2015, Shanxi Yuci Rural Commercial Bank Co., Ltd. directed fundraising Approved by the regulatory authorities, the registered capital was changed from 400 million yuan to 800 million yuan, and the Deyu company subscribed for 50 million shares at a price of 1.55 yuan per share, costing 77.5 million yuan.

  In addition, Longyue Industry held a general meeting of shareholders in 2014, invested in Shanxi Shouyang Rural Commercial Bank Co., Ltd., and purchased 20 million shares of the bank at a price of 2 yuan per share; invested 2 million yuan in Heshun County Guidu Village Bank Co., Ltd. , Holding 10%.

  For these small and medium-sized banks, the German Imperial Family can be said to be a white knight, which increased the registered capital of the bank and also absorbed some of the bank's bad debts.

But this capital crocodile seems to be good, but actually wants more.

After becoming a shareholder in the bank, the Deyu Department obtained a large amount of financing through pledge of bank shares, and blood transfusion to the Deyu Department through the asset management plan.

Taking the Lucheng Rural Business Act as an example, in addition to the above-mentioned 1.5 billion yuan default asset management plan, the Deyu Department has repeatedly pledged its bank equity.

  The above-mentioned person familiar with Shanxi's capital market told China News Weekly that among the city commercial banks in Shanxi, Yangquan Commercial Bank, Jinzhong Bank and Changzhi Commercial Bank are the most serious ones. The first two are related to the Deyu Department.

  This kind of capital operation of Deyu is risky and unsustainable.

According to Caixin reports, Longyue Industry had a large financing risk in 2017, with a financing amount of 36 billion yuan.

In 2017, Shanxi Province set up a risk disposal team for this purpose, and introduced Tunghsu Group, Rendong Group and ECCOM Ark Group to participate in the restructuring of Deyu debt.

By the end of September 2019, the financing of Longyue Industry will be reduced to 11.714 billion yuan.

Tian Wenjun

  The Deyu Department started from Jinzhong City, Shanxi Province, and the actual controller Tian Wenjun is good at capital operation.

According to the information obtained by "China News Weekly", including the aforementioned Longyue Industry, Heyou Industry, Jinzhong Yujia, etc., the Deyu Department controls at least 20 companies, of which more than half are agricultural trading companies.

  As the promoter of the company, Tian Wenjun transfers his equity to the company's employees and relatives, which is a typical feature of the German imperial family.

For example, the actual controller of Heyou Industrial is Tian Wenjun's wife Hao Jiangbo.

The natural person shareholders of Longyue Industry include Zhao Jing and Zhao Peilin. According to the employee table of the Deyu Department of Enterprises, Zhao Jing entered the work of the Deyu Department in 2003. She was responsible for various documents of the company in a guarantee company of the Deyu Department. Printing and proofreading work.

Zhao Peilin is also an employee of the German Imperial Department.

  Tian Wenjun acts low-key, and there is not much public information about him.

The senior executives of Jinzhong Bank were investigated this year, and after Tian Wenjun's company was seized, many local people in Jinzhong knew that there was such a person.

  According to an article on Jinzhong Information Network in December 2012, Tian Wenjun “grew up in a family of university teachers in Jinzhong City”. In 2006, he found in market research that there are huge business opportunities in agricultural and sideline products, so he led a young team Starting to start a business, this was later Deyu Agriculture.

"The Beijing News" quoted a local authoritative source in Jinzhong as saying that Deyu's predecessor was also a coal company, and later did agriculture.

  Around 2010, Tian Wenjun completed the integration of Zhang Junde’s Jinzhong Deyu Agricultural Trade Co., Ltd., Ren Yongqing’s Jinzhong Yongcheng Grain and Oil Trading Co., Ltd. and Jinzhong Yujia.

Through simple enterprise bundling, Deyu Agriculture claims to have created a new business model, from purchasing, processing to sales, Deyu Agriculture has opened up the entire industrial chain.

Tian Wenjun was able to lead Deyu Agriculture to ring the bell on Nasdaq, becoming the first company in Shanxi Province to land on the overseas capital market.

  Looking now, Tian Wenjun's capital operation routines are relatively advanced.

In 2011, Softbank Capital injected 25 million yuan into Deyu Agriculture and became the second largest shareholder with 35.71% of the shares.

In 2012, De Yu Fang, a domestic subsidiary of De Yu Agriculture, held a Hong Kong financing kick-off meeting at the Mandarin Oriental Hotel in Hong Kong.

Hong Kong Guotai Junan International Chairman Yan Feng and De Yufang Chairman Tian Wenjun signed a letter of intent for financing.

The press release stated that "Guotai Junan's participation in the shares will accelerate the landing of Deyufang in Hong Kong, a global capital market."

  At the 2013 Economic Work and Rural Work Conference in Yuci District, Jinzhong City, the leaders of Yuci District specifically mentioned Deyu Agriculture.

He called on companies to follow suit, summarizing and drawing on the experience and practices of Deyu Agricultural Capital's operations and group listings. "Just like Ren Yongqing, Zhang Junde, Hao Jianming, and Tian Wenjun, four unrelated companies were listed on the Nasdaq and financed their capital investment. reproduction".

  However, under these industrial coats, Tian Wenjun's core business has always been in the financial field.

After the establishment of Deyu Agriculture, Zhang Junde and Ren Yongqing, who were once partners, set up a new agricultural company.

The managers of Zhang Junde and Ren Yongqing both told China News Weekly that the company has no relationship with Tian Wenjun.

One of the responsible persons gave an example: "Tian Wenjun bought Jinzhong Deyu Agricultural Trade Co., Ltd. at that time, and our current company is Shanxi Deyu Agricultural Trade Co., Ltd. These are two completely different companies."

  In fact, the earliest company established by the Deyu Department was Shanxi Dongsheng Auction Co., Ltd., which was one of the earliest auction institutions in China.

Shanxi Dongsheng Auction Co., Ltd., formerly known as Yuci Auction Market, was established in August 1998. It is the only public auction agency designated by the People's Government of Yuci District, Shanxi Province after the original Shanxi Provincial Department of Trade.

It was not until 2004 that the access restrictions on the Chinese auction industry were fully liberalized.

  In 2006, Tian Wenjun established Shanxi Dongsheng Financial Guarantee Co., Ltd., specializing in private lending.

The Beijing News quoted the founder of Shanxi's private financial institutions: “After the coal industry fell in 2013, Shanxi’s economy encountered great difficulties. It is very difficult for private enterprises to finance loans. Therefore, there are many various private financial institutions. Guarantees, financial leases, small loans, pawns, etc. In the Jinzhong area, Yuci in particular is the most."

  With the increasing demand for private financing, this company has become an important platform for the Deyu Department and the core company of the demon stock stable financial.

However, Tian Wenjun's private guarantee business is not ideal.

According to information obtained by "China News Weekly", in 2008, Dongsheng guaranteed revenue of 570,000 yuan and a loss of 1.33 million; in 2013, the company's revenue was about 5.8 million yuan and a profit was 1 million yuan.

How to break the game after a full-blown risk

  As early as 2017, the debt risk of Deyu's enterprises had already exploded. Shanxi Province established a large debt financing risk disposal leading group and introduced Dongxu Group to undertake debts.

Caixin reports that the three newly introduced companies have also experienced debt crises and are locked in with small and medium banks in Shanxi. For example, Tunghsu Group has loaned 20 billion yuan in Shanxi Province, involving 57 small and medium banking institutions, and almost all of them have defaulted so far.

  “In the past few years, some companies invested in shares and even controlled a number of small and medium banks through some means. The typical case is that the'Tomorrow Department' controls many banks including Baoshang Bank.” Dong Ximiao, chief researcher of China Merchants Finance, told China News Weekly ".

  Dong Ximiao believes that in recent years, the business model of financial holding groups has continued to emerge, which is also one of the reasons for the increase in the number of illegal and illegal related-party transactions. "Some private capital has entered the banking industry aggressively, controlling small and medium-sized banks, and forming a de facto financial holding group. Under this financial holding model, related party transactions are more concealed and risks are more conductive."

  "Dongxu's capital chain was broken. It was a series of events with the crisis of the German Imperial Family, which eventually caused the lid to become irresistible." A local financial industry observer in Shanxi believes that the local government has not resolved the previous debt risk and is a last resort. Started to reorganize several unlisted city commercial banks in Shanxi.

  From August 8th to 10th, Jincheng Bank, Jinzhong Bank, Yangquan City Commercial Bank and Changzhi Bank successively issued announcements stating that they plan to convene an extraordinary general meeting of shareholders to review proposals on participating in mergers and reorganizations or new mergers.

Shanxi Province’s public service platform for bidding and bidding posted a bid announcement for the Shanxi City Commercial Bank’s reform and chemical insurance work preparation team’s selection of intermediary service projects. The project overview is for Datong Bank, Changzhi Bank, Jincheng Bank, Jinzhong Bank, and Yangquan City Commercial Bank. Five city commercial banks are evaluated.

According to many local people in Shanxi, Datong Bank is different from the other four city commercial banks. Its controlling shareholder is the Datong government, and its willingness to reorganize and merge is not high.

  A person in charge of the Shanxi Banking and Insurance Regulatory Bureau told China News Weekly that the current reorganization is led by the Shanxi Provincial Finance Office. The problems of these banks are handled by the Shanxi Commission for Discipline Inspection. After investigations into the bank executives involved, they will inform the Banking and Insurance Company. Supervision Bureau.

A staff member of the Shanxi Provincial Finance Office told China News Weekly that the current restructuring plan has been reported but has not yet been approved.

  It is worth noting that many persons in charge of the Shanxi Provincial Rural Credit Cooperatives Union, Zhang Anshun, Jing Hui, etc., who have been dismissed, worked in the Shanxi financial system from 2009 to 2020, and this period is also a rural credit The period of time for a large number of social reforms and capital increase and share expansion of city commercial banks.

The Deyu Department also invested heavily in local commercial banks during this period.

  Dong Ximiao believes that after the restructuring of small and medium-sized banks, there are still widespread problems such as the need to optimize the ownership structure and insufficient shareholder management.

The reasons are that the problem of the absence of owners has long existed, and the problems of insider control and the offside of major shareholders exist at the same time; the second is that the qualifications of some bank shareholders do not meet the requirements, there are problems such as equity holdings, and the bank shareholder changes have not been submitted for approval as required ; The third is that shareholders’ capital contributions are untrue, there are false capital contributions by shareholders to banks, the source of funds is unknown, non-self-owned funds are used as equity funds, and bank funds are even used for internal circulation.

  The above-mentioned problems are also common in the banks that the Deyu Group has invested in. There are a lot of flaws and irregularities in the compliance of the equity transfer and the appointment of directors, supervisors and senior managers.

The aforementioned person in the Shanxi Capital Market believes: "Deyu has invested in so many banks. If there is no deep background, it will not be able to operate. Banks cannot be ignorant of the risks of these companies. Without the approval of the competent authority, no one dares to put money. All loaned out."

  "We must combine risk prevention and control with financial anti-corruption, seriously investigate and deal with the corruption behind the risks, and resolutely dig out and clean up the "worms" in the financial field." On June 18 this year, the Shanxi Provincial Party Committee held a financial reform work conference. Lou Yangsheng, secretary of the Shanxi Provincial Party Committee, said at the meeting.

  In addition to the planned reorganization of five city commercial banks, Shanxi Province's rural credit system has also undergone major personnel adjustments.

In June of this year, Wang Ya, director of the Audit Department of Shanxi Province, served as the party secretary and chairman of the Shanxi Rural Credit Cooperatives Union (provincial association), and Chen Xiangyang, deputy director of the Shanxi Provincial Department of Finance, became the deputy secretary of the Shanxi Provincial Association.

The restructuring of rural commercial banks and the resolution of financial risks have been listed as one of the major reforms of the Shanxi Provincial Party Committee in 2020.

  Restructuring and risk reduction have become the key words for Shanxi's financial industry to rectify and enter the deep water zone.

After the financial anti-corruption, how the Shanxi rural credit system and city commercial bank system will speed up the break in the future is worthy of attention.

  "The local government shoulders the responsibility of disposing of territorial risks, but local governments should not get involved too much. It should be resolved by professional financial management departments and the market." Dong Ximiao believes that "the primary responsibility of local governments is to create a good financial ecological environment. "

  China News Weekly, Issue 33, 2020

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