China’s Top Tech Banker Goes Missing, Unnerving Finance Industry

(Bloomberg) — The disappearance of high-profile banker Bao Fan is fueling speculation of a renewed clampdown on China’s finance industry.

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Bao’s company China Renaissance Holdings Ltd. said on Thursday it had lost touch with the banker, one of the country’s most prolific dealmakers over the past two decades. China Renaissance shares plunged as much as 50% in early Hong Kong trading on Friday.

Bao has been out of contact with the company for about two days, a person familiar with the matter said, adding that the banker’s family was told he’s assisting an investigation.

Former China Renaissance President Cong Lin has been involved in an investigation by authorities since September, the person said, asking not to be named as the matter is private.

While it’s not uncommon for executives in China to become unreachable when they’re involved in a government probe, Bao’s absence is sending chills down the finance industry. The outspoken financier has sprawling connections across sectors and has been the go-to banker for some of China’s biggest companies.

Read more: Missing Bosses Add to Risks of Investing in China: QuickTake

The investment bank said its board isn’t aware of any information indicating that Bao’s unavailability may be related to the company’s business or operations, and it’s running normally under the executive committee. Bao holds a controlling stake and is chairman and chief executive of the company.

A China Renaissance spokesperson in New York declined to comment about Bao when reached by phone on Thursday. The firm didn’t immediately respond to an emailed request for comment on Cong Friday. Caixin first reported Bao’s absence.

“It could be a long-term overhang on the stock, given Bao is the key man for the company,” said Willer Chen, senior analyst at Forsyth Barr Asia Ltd.

Chinese President Xi Jinping launched a broad anti-corruption probe in late 2021 targeting the nation’s $60 trillion financial sector, which has brought down dozens of officials. The probe has also implicated the investment banking community, ensnaring bankers from brokerages including Everbright Securities Co. and Guotai Junan Securities Co.

Still, China has eased its stance toward the private sector in recent months, lauding Ant Group Co. for following the Communist Party’s leadership and resuming ride-hailing service Didi in app stores. It has also issued sweeping measure to prop up the real estate sector.

Bao, a former banker at Morgan Stanley and Credit Suisse Group AG, made a name for being able to broker difficult mergers and acquisitions, including ones that led to the formation of Didi Global Inc. and Meituan.

China Renaissance itself is also an active investor, backing many tech companies that have grown to giants including NIO Inc. and WuXi AppTec Co., according to its website.

It was a bookrunner on Inc.’s $2 billion US initial public offering in 2014, and a top underwriter for Kuaishou Technology’s Hong Kong listing in 2021, the biggest internet IPO since Uber Technologies Inc.’s debut in 2019.

Bao expanded the company’s business into wealth management and brokerage services. China Renaissance had about 48.6 billion yuan ($7.1 billion) under its investment management at the end of June 2022, according to its most recent interim report.

Cong held various positions at Industrial & Commercial Bank of China Ltd. He left China Renaissance last year, a person familiar with the matter said.

–With assistance from Jacob Gu, Foster Wong and John Cheng.

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