Exclusive | Zhongjing Group Leader Gao Yang: Currently 8 billion yuan in debt, the most difficult phase. Intensive negotiations ongoing regarding the sale of Huishang Bank equity.

（Source: Caixin Media Asset Management Vision）

“Sorry for the wait. I was also talking with the intended buyers of Huishang Bank just now.”

As spring returned to March, inside a villa on Shanghai’s Wukang Road, Gao Yang had just finished receiving a batch of guests. Smiling, he told a Caixin Media reporter.

As the head of the Zhingjing faction, Gao Yang’s total assets under his control had once been several hundred billion yuan. After selling his equity stake in Huishang Bank to Jinsang in 2019 for 12.15 billion yuan failed, the Zhingjing faction’s funds broke down. Since then, Gao Yang had largely disappeared from public view until he returned last year.

Recently, Gao Yang accepted an exclusive interview with a Caixin Media reporter, and for the first time provided a detailed explanation of key topics, including the progress in dealing with the Zhingjing faction’s debts and the 3.89 billion yuan dispute with Jinsang. Gao Yang admitted that the current period is the most difficult time since he founded Zhongjing Group. The Zhongjing faction is using the plan to dispose of the core asset—its equity stake in Huishang Bank—as the ultimate solution, working around the clock to defuse about 8 billion yuan in debt pressure.

As of now, the potential buyers of Gao Yang’s Huishang Bank equity stake have included Jinsang, Sanwei, and Dongjian, but as of now there is still no definite progress. Meanwhile, in addition to selling equity, Gao Yang and Huishang Bank have also had long-running disputes over bank governance and dividends. In February, at Huishang Bank’s extraordinary general meeting of shareholders, Gao Yang’s interim dividend proposal was rejected again, with an approval rate of only 25.55%.

On the morning of March 26, Huishang Bank’s next board meeting is about to be held. With the conflict between management and Gao Yang—its major investor—standing in the way, will it erupt again?

Zhongjing’s total liabilities are about RMB 8 billion

Caixin Media reporter: Is it the most difficult few years since you invested in and founded Zhongjing Group?

Gao Yang: Yes.

Caixin Media reporter: Before, Jinsang gave you 3.88 billion. Where did all that money go?

Gao Yang: To repay debts, including bonds and loans—everything is recorded.

Caixin Media reporter: If Zhongjing sells assets now, the core asset is certainly still the equity stake in Huishang Bank. Is that still being sold?

Gao Yang: Yes, it’s still being sold. We were discussing it just now.

Caixin Media reporter: Can you share the parties you’re in talks with, and the rough pricing?

Gao Yang: We’re talking with private companies, state-owned entities, insurance companies, and asset management companies. We haven’t reached the signing stage, so we can’t disclose it. Last year, there were four recorded transactions of large bank equity stakes—for example, New China Life bought the equity in Hangzhou Bank at 0.8 times PB. In June, Cinda bought the equity in China Everbright Bank at 0.6 times PB; in July, Eastern Asset bought the equity in China Everbright Bank. In the case of Sichuan Bank buying the equity in Deyang Bank (Great Wall West China Bank), the price was 1.05 times PB. I believe these transaction prices reflect the current market conditions for large bank equity transactions.

Caixin Media reporter: What proportion is being sold?

Gao Yang: All of it.

Caixin Media reporter: There’s a report that Yantai Financial Holding later sued after purchasing bonds. After that, you said you would settle by offsetting equity. Is that referring to Huishang Bank’s equity stake?

Gao Yang: The matter of settling by offsetting equity is not referring to Huishang Bank’s equity stake. It’s a solution discussed with our creditors. First, extending the term and lowering interest rates. Second, offering a discount. Third, settling by offsetting equity—what is offset is Zhongjing Xinhua’s equity, which is essentially debt-to-equity conversion. These are common approaches in the market for handling overdue debts. Selling Huishang Bank’s equity stake is the ultimate solution.

Caixin Media reporter: Currently, how large is Zhongjing’s overall debt roughly? How much is still unpaid after maturity? Besides Huishang Bank’s equity stake, are there other core assets?

Gao Yang: Overall debt is roughly 8 billion yuan. Roughly more than 6 billion yuan is past due and unpaid, including 3.89 billion owed to Jinsang, 900 million in bonds, and 500 million owed to Shanghai Life.

Caixin Media reporter: Since this year began, what changes have there been compared with before in terms of your thinking?

Gao Yang: There have definitely been changes. In the future, I want to return to Austria earlier. The top priority right now is to resolve the company’s difficulties.

Caixin Media reporter: Do you think Zhongjing has much hope for the future?

Gao Yang: We’ve been working at it.

Caixin Media reporter: So the hope isn’t big?

Gao Yang: Every day we see more hope than yesterday. The most important thing is that our underlying assets—(the equity stake in Huishang Bank)—are still there. Unlike some real-economy enterprises, once the top leader is gone, many people may leave, factories may stop and operations, and the company may collapse. But our core asset is a bank equity stake. This bank isn’t the one I’m responsible for in day-to-day operations. They (management) have been there all along; it’s just that they manage it better or worse. Also, I’m very grateful to our employees. When I’m not around, they held the company up.

The creditor claims of the Jinsang faction have already been transferred

Caixin Media reporter: Then I’ll ask a second set of questions, about Jinsang. Now the restructuring voting process of Jinsang Group has already started, with the deadline being April 15. Do you know the progress? In terms of the follow-up disputes with us at Zhongjing, the main issue is the equity of Zhongjing Sihai—meaning the equity of Huishang Bank. Is it now that Ningbo Jinzi is taking over Jinsang and us to talk?

Gao Yang: Nothing has been decided yet. Only after the voting passes on April 15 and the court issues a ruling will Ningbo Jinzi become the disposal entity and cooperate with the bankruptcy administrator to carry out the disposal work.

Caixin Media reporter: So are we having preliminary communications and contact with Ningbo Jinzi now?

Gao Yang: He hasn’t been appointed yet.

Caixin Media reporter: Are they all procedural matters?

Gao Yang: Procedurally, last time Jinsang Group’s restructuring voting also didn’t pass. Can you ensure it will pass this time? Maybe creditors also have different ideas. But the probability of passing this time should be a bit higher than last time, because the proposed plan’s price this time is higher.

Caixin Media reporter: Currently, regarding our dispute with Jinsang, the core is to return 1.88 billion yuan to Jinsang Group and 2 billion yuan to Jinsang Holding. Both of these payments haven’t been made yet, right?

Gao Yang: Yes. Neither has been paid. According to the court’s judgment, both sides have obligations to return payments to each other. Jinsang Group also hasn’t returned to Zhongjing the 51% equity stake in Zhongjing Sihai.

Caixin Media reporter: It’s understood that, in the dispute with Zhongjing, Jinsang had transferred its creditor claims to Hongcheng Jinsang and Juxiang Jinsang. What exactly is that situation?

Gao Yang: They’ve already completed the transfer of creditor claims themselves. In essence, it’s an act to evade debts. The debts being evaded are the creditor claims of Jinsang Holding. They transferred a potentially effective asset to two partnership entities—Hongcheng Jinsang and Juxiang Jinsang. In practice, these partnership entities are actually managed by the shell entities under their control. The debt-avoidance behavior of Jinsang Holding should be supervised by Jinsang Holding’s creditors. But Jinsang Holding has not gone through bankruptcy restructuring.

Caixin Media reporter: Who made that decision?

Gao Yang: The widow of Zheng Yonggang of Jinsang Jinsang. But we at Zhongjing don’t recognize it. We don’t accept that these two partnership entities can represent Jinsang to exercise rights. We have already submitted our response, and the court has rejected their claims.

Caixin Media reporter: Then when Jinsang was restructured, why didn’t they combine the associated companies across the entire Jinsang Group and the entire Jinsang Holding system into a combined restructuring?

Gao Yang: The core was to put the interests of Jinsang Holding’s creditors further back, and to prioritize the interests of Jinsang Group’s creditors. What I don’t understand is why Jinsang Holding’s creditors didn’t apply to restructure Jinsang Holding through bankruptcy. If they did—and if the court accepted the case—then Jinsang Group would be merged with it, and Jinsang Holding’s creditors could also get a slightly larger share.

Caixin Media reporter: If Jinsang Holding’s creditors didn’t take action, that’s their business. Why did you submit a response?

Gao Yang: These are two separate things. Because they transferred their creditor claims against us to these two partnership entities, and then the partnership entities would exercise enforcement rights. I believe they didn’t have that right. The transfer of creditor claims requires our consent.

“My voting only looks at reasonableness”

Caixin Media reporter: At the shareholders’ meeting of Huishang Bank in February, your dividend proposal was rejected. How do you view this? As of now, your main relationship with Huishang Bank’s major shareholders and management—essentially the Anhui state-owned assets system—what kind of relationship is it? There’s a claim that in the past you rejected all their proposals, and now some are supporting. Has there been a change in the relationship between the two sides?

Gao Yang: I have never indiscriminately rejected all proposals for any reason. My vote only considers whether it’s reasonable. If it should pass, it should pass; if it shouldn’t, I oppose it—whether it’s the board meeting or the shareholders’ meeting.

I’ve always maintained good communication with their management. I never say that we don’t communicate. For example, when we proposed this at the 2025 shareholders’ meeting, the reason was that since the state has revised such a Company Law and many other banks have done the same, then we can also do something—doing something can save a bit of money, can’t it? Adding a supervisor board plus a supervisor board office costs quite a lot each year. I can tell you the reason. At the time, a senior executive personally told me that because the chair of the board of supervisors hadn’t yet reached the retirement age, after they removed the supervisor board, where would he go? Their starting point was different from mine. That’s how simple it is.

Caixin Media reporter: Do you have direct communication with Huishang Bank President Kong Qinglong now? Or is it a relatively conflicting relationship?

Gao Yang: When the former chairman Yan Qingming was in office, we met and exchanged views many times. As for Kong Qinglong, because he is only the president at present, we basically only have simple exchanges each time before board meetings.

In fact, I’ve only had direct conflicts with two chairmen—Li Hongming and Wu Xueming. The conflict with Wu Xueming began with Huishang Bank’s acquisition of Baoshang Bank. I believed there were problems in that transaction. Later, facts confirmed that there truly were problems. As for other directors and executives, it’s just that our understanding of different matters differs.

Caixin Media reporter: Over all these years, your governance philosophy toward banks seems to have never changed.

Gao Yang: The philosophy of being an active shareholder has indeed never changed. I’ve only followed the suggestions made under the Company Law and the articles of association, and I believe they were reasonable. But they rejected my proposals and fobbed me off with various reasons, so I can only smile.

Caixin Media statement: The contents of this article are for reference only and do not constitute investment advice. Investors act on this at their own risk.

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