The spectacular fall of Anbang's boss
The founder and former president of Anbang, Wu Xiaohui, was sentenced to 18 years in prison for fraud and embezzlement. Pushed to resign in June 2017, Wu Xiaohui will have to refund 10.5 billion CNY (1.7 billion USD). Its real estate and financial assets, including businesses, have already been seized according to local sources.
Since its founding in 2004, Anbang has recorded spectacular gains. Originally specializing in motor insurance and real estate, the insurer has become in a short decade, an international financial giant. He multiplied acquisitions in China, in Korea (Tong Yang Life) and in Europe (Fidea NV and Vivat).
The group became publicly known in 2014 with the purchase of the Waldorf Astoria Hotel in New York for nearly 2 billion USD. Anbang is now number four in China with 320 billion USD in assets, 30 000 employees and 35 million customers.
The risk of insolvency, the opacity of the structures and the dubious practices of the company in financing its growth, such as the sale of high-risk investment products, have finally forced the state to intervene and take direct control of the group in an attempt to avoid its collapse.
As a reminder, Anbang was bailed out by 60.8 billion CNY (9.6 billion) in April 2018 to "maintain the stability of its operations".
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