Chinese authorities have imposed an exit ban on a top investment banker of Japanese asset management group Nomura, sources with direct knowledge of the matter have said.
Charles Wang Zhonghe, the China investment banking chairman at Nomura, is prohibited from travelling outside the mainland, the sources said. It was not immediately clear when the exit ban took effect.
The Financial Times newspaper, which first reported the matter, citing sources, said the ban was connected to Beijing’s investigation into top tech dealmaker Bao Fan, whose disappearance early this year shook the business community in China.
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Bao, the founder of investment bank China Renaissance Holdings, was “taken away” following an investigation into Cong Lin, the former president of the bank.
Cong was believed to be facing investigation for suspected wrongdoing while he was chief executive of ICBC International, a unit of state-owned Industrial and Commercial Bank of China (ICBC).
Nomura’s Wang had an overlap with Cong at the unit from 2011 to 2016, his LinkedIn page shows. Wang is assisting the authorities with their investigation of Cong, for which he needs to stay on the mainland, one of the sources said.
Wang was based in Hong Kong, his LinkedIn profile showed, though his nationality was not immediately known.
A Tokyo-based spokesperson for Nomura declined to comment. Wang did not respond to a Reuters request for comment sent via the LinkedIn social network.
Exit bans worsen business uncertainty
China’s exit bans have ensnared scores of Chinese and foreigners, a report by rights group Safeguard Defenders has previously shown.
The bans have added to growing business uncertainty under Xi Jinping’s authoritarian government, with Western firms grappling with increasing crackdowns and vague new laws.
Earlier this year, foreign firms were rattled by Chinese authorities’ raids on US consultancy firms Capvision, Bain & Company and Mintz Group. Last month, Beijing fined Mintz about $1.5 million for doing “unapproved statistical work”.
One Singapore-origin executive from Mintz was also banned from leaving China, like Nomura’s Wang.
Asked why the Nomura banker was barred from leaving, Chinese foreign ministry spokesperson Wang Wenbin said he did not have knowledge of the situation at a regular news briefing on Monday.
Wang added: “I would like to reiterate that China has always been committed to providing a market-oriented, legalised and internationalised business environment for foreign enterprises to operate legally.”
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Rock-bottom sentiment
Wang, who joined Nomura in 2018 after having worked at Deutsche Bank and Chinese brokerage Zhong De Securities, besides ICBC, recently attended work events on the mainland, the second source added.
In August last year, he was also appointed as chairman of Nomura Orient International Securities, the bank’s majority-owned securities business headquartered in the commercial hub of Shanghai.
A Reuters analysis has found an apparent surge of court cases involving bans, such as the one imposed on Wang, in recent years. Foreign business lobbies and top trade representatives from US and Europe have voiced concern about the trend.
On Monday, the European Union trade chief Valdis Dombrovskis sounded anxiety on new Chinese laws whose “ambiguity” leaves “too much room for interpretation.”
“This means European companies struggle to understand their compliance obligations: a factor that significantly decreases business confidence and deters new investments in China,” he said.
Dombrovskis was referring to new laws unveiled by Beijing this year, including a foreign relations law that warns against “acts” detrimental to China’s national interests. Another — an anti-espionage law — bars the transfer of information linked to national security, but does not specify what such information might be, raising compliance risks for foreign companies.
US Commerce Secretary Gina Raimondo also stressed on the need of a predictable business environment in China, during her recent visit to Beijing. US businesses had complained to her that China had become “uninvestible”, Raimondo said.
“Patience is wearing thin among American business,” she said in an interview on US broadcaster CBS.
Raimondo’s concerns were also reflected in a recent survey by AmCham Shanghai that found business outlook of US companies operating in China had sunk to a record low.
- Reuters, with additional inputs from Vishakha Saxena
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