Zili Shao.
Zili Shao. ()

Former King & Wood Mallesons China co-chair Zili Shao has joined rival Fangda Partners after less than two years.

Shao, a corporate lawyer and an investment banker, joins Shanghai-based Fangda as a non-executive chairman. He is not a partner at Fangda but will lead the firm’s management and strategic initiatives, according to a press release.* 

Meanwhile, earlier this month, Beijing-based financial media outlet Caixin reported that Shao will start a new investment fund that taps into China’s nonperforming loans and other distressed assets. Shanghai-based Lingyue Capital will be launched in cooperation with state-owned Sinochem Corp., Shanghai International Group and Shenzhen-based brokerage First Capital Securities Co. Ltd., JPMorgan Chase & Co.’s former joint venture partner.

Shao had left King & Wood Mallesons before the firm’s February announcement that former Hong Kong partner Zhang Yi would be the firm’s new China chairman. He joined the firm in April 2015 to co-lead the Swiss verein’s China arm alongside global chair Wang Junfeng. Shao joined from JPMorgan Chase & Co., where he was Asia Pacific vice chairman. (He remained a senior adviser to the U.S. investment bank once he joined King & Wood Mallesons.)

Before his appointment as JPMorgan Chase’s Asia Pacific vice chair in 2014, which occurred at a time when the bank’s hiring of relatives of influential Chinese government officials was drawing attention from U.S. regulators, Shao had been JPMorgan’s China chief executive and chairman for five years. He moved there from Linklaters, where he had been Asia managing partner.

Shao was legally trained in China and Australia. He started practicing first with then-Mallesons Stephen Jaques in Melbourne, and later with Allens Arthur Robinson.

As the Chinese economy slows down, bad debt has been piling up. It reached an estimated $3 trillion in total volume last year, according to the Financial Times.

Fangda Partners said it now has 500 lawyers across Shanghai, Beijing, Shenzhen and Hong Kong offices.

King & Wood Mallesons declined to comment on Shao’s departure.

Update 6/15: This story has been updated with Shao Zili’s joining Fangda Partners as a non-executive chairman.