China regulator to assume management of Waldorf owner Anbang

BEIJING (AP) — China's insurance regulator said Friday it is assuming management of insurer Anbang, owner of New York's iconic Waldorf Astoria hotel, following the indictment of the company's chairman on charges of economic crimes.

The China Insurance Regulatory Commission said Friday that it would take over operations for one year beginning immediately.

The indictment of Wu Xiaohui and the related violations of laws and regulations had raised questions about Anbang Insurance Group Ltd.'s solvency, creating the need for it to take protective measures under Chinese law, the commission, known as the CIRC, said in a statement posted on its website.

Wu had turned over his management duties to other executives in June following a report he was detained by regulators amid accusations of possible financial misconduct.

No details were given about the charges against Wu or specific violations of laws and regulations within the company.

The CIRC said it dispatched an investigative team to Anbang in June to gain a better understanding of its inner workings, strengthen on-site supervision and push for improvements in operations and management.

"At present, operations of the Anbang Group are stable overall and business is basically steady," the statement said. "The legitimate rights and interests of insurance consumers and individual stakeholders are being protected effectively."

Wu's duties as chairman and general manager would be redistributed and a working committee established in conjunction with the People's Bank of China, the China Banking Regulatory Commission, the Foreign Exchange Bureau and other departments to handle the management takeover process and ensure smooth operations, the statement said.

It said the takeover would not affect the company's external debt responsibilities.

Privately held Anbang built a reputation for unusually aggressive expansion in a Chinese insurance industry dominated by state-owned companies, placing it under scrutiny by regulators.

In particular, a multibillion-dollar global string of asset purchases, including buying the Waldorf for $2 billion, raised questions about how it was funding its buying spree. The company said the money was raised from shareholders.

In the process of expansion, it suffered setbacks in failing to complete several foreign takeovers, including the proposed purchase of U.S.-based Fidelity & Guaranty Life for $1.6 billion.

Earlier, the company had discussed possibly investing in a Manhattan skyscraper owned by the family of Jared Kushner, U.S. President Donald Trump's son-in-law and adviser. Those talks ended in March without a deal.

Anbang has more than 30,000 employees serving 35 million clients and has interests in life insurance, banking, asset management, leasing and brokerage services.