(Yicai Global) April 13 -- The anti-corruption storm around China Everbright Group continues to swirl. Following the implication of former Chairman Li Xiaopeng, a number of staff of the state-owned financial giant’s trust company have been taken away for questioning, with many real estate companies implicated, Yicai Global learned today.
The trust arm, Everbright Xinglong Trust, participated in Shenzhen’s shanty town renovation projects, including several in partnership with developers such as China Evergrande Group and Kaisa Group, where defaults occurred on Everbright trust products. And investigation found that bribes were involved in the process of borrowing funds for the projects, a person familiar with the matter told Yicai Global.
China’s discipline inspection authorities announced on April 5 that Li, who retired from Everbright last year, was under investigation for suspected serious violations of the law. The trust arm’s case is also related to the above investigation, the person noted.
Ke Peng, former executive president at Evergrande and head of the developer’s shanty town renovation projects in Shenzhen, was taken away by police for investigation, news portal Ifeng reported in January. Evergrande had 62 renovation projects in the southern Chinese city, the debt-ridden property giant revealed in its 2021 interim report.
Everbright set up Everbright Xinglong Trust in May 2014 by restructuring the former Gansu Trust and has a 51 percent stake in it. The latest financial data showed that Everbright Xinglong Trust had a net profit of CNY711 million (USD103 million) in the first half of last year, down 49 percent from a year earlier.
In recent years, Everbright executives have been involved in numerous violations. In April last year, six executives of its brokerage subsidiary Everbright Securities, including then Chairman Yan Jun, were collectively removed from office for disciplinary violations.
In addition, Zhang Huayu, former deputy president of Everbright Bank, and Zhang Bo, former business director, were also investigated last year.
Editors: Dou Shicong, Peter Thomas