China securities regulator promotes law enforcement chief to vice chair
Updates throughout with CSRC confirmation of Li Ming's promotion
HONG KONG/BEIJING/SHANGHAI, July 30 (Reuters) -China's securities regulator on Tuesday promoted its head of law enforcement to the role of vice chairman, underscoring Beijing's determination to tighten oversight of its $5.1 trillion stock market.
Li Ming, chief of the enforcement bureau of the China Securities Regulatory Commission (CSRC), will replace vice chairman Fang Xinghai, the CSRC said in a statement, citing a decision by China's State Council, or cabinet.
The announcement confirmed an earlier report by Reuters. Fang, born in 1964, is retiring, according to sources with direct knowledge of the personnel change.
President Xi Jinping is seeking to foster a capital market able to channel resources into strategic sectors such as chip-making and high-end manufacturing amid increasing economic rivalry between China, Europe and the United States.
The CSRC has pledged to regulate the market with "teeth and thorns" under chairman Wu Qing.
Prior to the promotion, Li headed the enforcement bureau, which is responsible for probing illegal securities activities, handing criminal cases to the relevant authorities and facilitating cross-border investigations.
During a media conference in February, Li vowed to crack down on insider trading and market manipulation as well as stamp out securities fraud in an effort to protect investors.
"Punishment will be more and more severe, and the cost of breaking the law will only be higher and higher," Li said.
A CSRC veteran, Li began working in its Listing Department, which oversees share sales, and in 2016 was put in charge of the National Equities Exchange, a bourse for trading over-the-counter shares, according to business media groupCaixin.
Li returned to the Listing Department as director-general in 2020 and was appointed to lead the enforcement bureau in 2022, the Chinese media group added.
China's regulators have been scrutinising old business deals and the personal bank accounts of senior executives as they ramp up inspections of IPO hopefuls, a process that has forced firms to drop listing plans and investment banks to cut jobs and pay.
The stock market scrutiny coincides with a "common prosperity" drive aimed at addressing social and income inequality as economic growth slows.
China will "tighten regulation to promote the sound and stable development of the capital market", according to a resolution issued after a key Communist Party meeting held earlier this month.
Li's predecessor Fang is seen as the most market-oriented senior official at the CSRC. Stanford-educated Fang has been a strong advocate of market reforms.
Fang became CSRC vice chairman following a 2015 market crash and under his watch, China opened its stock and bond markets wider to foreign investors and introduced a slew of derivative products.
Over the past year, however, the CSRC has restricted short-selling and cracked down on computer-driven quant funds - both seen as contributing to market volatility.
($1 = 7.2502 Chinese yuan renminbi)
Reporting by Reuters Staff; Editing by Sumeet Chatterjee and Miral Fahmy
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