Regulator sees risks in capital guarantee funds

    THE securities regulator said Friday it sees potential risks in the country’s 330 billion yuan (US$49.67 billion) capital guarantee funds business and will strengthen rules on such investment products.

    The China Securities Regulatory Commission said it would promulgate rules that require fund managers to restrict size of such products in relation to their net capital and set aside loss reserves, among other measures to control risks. Capital guarantee funds are investment products in which the investor’s principal is shielded from losses.

    Everbright Securities raises US$1.1b in HK IPO

    EVERBRIGHT Securities Co. raised US$1.1 billion after pricing its Hong Kong initial public offering (IPO) above the midpoint of a marketed range.

    The Shanghai-listed brokerage sold 680 million shares at HK$12.68 (US$ 1.63) each, after earlier offering them at HK$11.80 to HK$13.26 apiece, according to terms for the deal. The final price represents a 38 percent discount to Everbright Securities’ last closing price in Shanghai.

    Haier fined for monopolistic behavior

    A PRICING regulator in China has fined three subsidiaries of appliance maker Haier Group 12.3 million yuan (US$1.9 million) for monopolistic behavior, the government said Friday.

    Shanghai’s local pricing regulator, under the direction of the National Development and Reform Commission (NDRC), fined the three subsidiaries for including price fixing measures in sales policies and agreements with vendors, according to a statement on the NDRC website. The companies are subsidiaries of Qingdao Haier Co. and Haier Electronics Group Co. The fine is equivalent to 3 percent of annual sales at the companies, the statement said.

    Firm confirms default on dim sum bond

    CHINA City Construction International Co., an unlisted Hong Kong subsidiary of a mainland construction and development firm, confirmed it has defaulted on a portion of an outstanding yuan denominated dim sum bond traded in Hong Kong.

    China City Construction first ran into trouble in April when a change in ownership in its parent company, China City Construction Holding Group Co., triggered an early redemption clause for the 2.5 billion yuan (US$376.51 million) offshore yuan bond maturing in 2017.