Two Key Executives Associated With China's Shadow Bank Zhongzhi Reported Missing

Financial conglomerate Zhongzhi is being investigated following its disclosure of a $36 billion deficit.

Two Key Executives Associated With China's Shadow Bank Zhongzhi Reported Missing

Zhongzhi Enterprise Group is a major lender in China.

Concerns over potential detention arise as two companies associated with the embattled Chinese shadow bank Zhongzhi Enterprise Group report losing contact with their chairpersons.Xinjiang Tianshan Animal Husbandry Bio-Engineering disclosed on Thursday that its chairman, Ma Changshui, was unreachable. A similar announcement was made on Wednesday by Dalian My Gym Education Technology, stating its chairwoman, Ma Hongying, couldn't be contacted.

"The company is not sure of the specific reason why it cannot get in touch with Ms. Ma Hongying," the company said in a filing to the Shenzhen Stock Exchange on Thursday.

According to CNN, Ma Changshui, 59, serves as the vice president of Zhongzhi along with his position at the animal breeding firm. He was previously the chief risk control officer of the group.

Beijing-based Zhongzhi controls nearly a dozen asset and wealth management firms. It is considered part of China's $3 trillion "shadow banking" industry, a sector that forms an important source of finance in the country. The term usually refers to financing activity that takes place outside the formal banking system, either by banks through off-balance-sheet activities, or by non-bank financial institutions, such as trust firms.

Both companies have attempted to reach their respective chairpersons through various means, including phone calls, WeChat messages, and indirect communication with family members. However, all efforts have been unsuccessful, fueling speculation that the chairpersons may have been detained by the Chinese government.

These developments come amidst an ongoing government investigation into Zhongzhi Enterprise Group, which is suspected of engaging in irregular financial practices.