The China Securities Regulatory Commission (CSRC), the regulator that spearheaded the country’s recent controversial market bailout programme, is under increased scrutiny due to one of its top executives being targeted for investigation by the central government’s disciplinary commission.
The Central Commission for Discipline Inspection declared Zhang Yujun, the CSRC’s assistant chairman, is suspected of severe rule violations, without specifying which particular rules he’d breached.
Mr. Zhang was a key figure in the CSRC’s recent drive to stabilise the A-share market, initiating measures such as garnering capital from securities firms and the central bank to buy stocks at the height of the market crash. He has chaired several meetings with securities and fund management companies in recent times, which addressed the need to step up probes into program trading and clients’ accounts in order to battle any malicious short-selling activities.
As A-share volatility gradually returned to normal, Mr. Zhang was at one point tipped to be rewarded with the role of vice governor of the People’s Bank of China, in recognition of his efforts to stem the plummeting market.
However, the CSRC’s recent A-share bailout efforts measures created a bit of a storm as the China Securities Finance Corporation – the main entity employed to access the stock market on behalf of the state – included a number of small private companies in its stock-buying list. This prompted much derision, as speculation was rife that the officials involved had intended to prop up stock prices for entities they had connections with.
More recently, Zhuang Xinyi has been removed from his position as vice president at the CSRC. This follows on from another crackdown on the securities watchdog in which one current and one former CSRC employee were requested to assist in an investigation by the public security bureau last month, which is still ongoing.
