Standard Chartered, UBS sued over IPO

    HONG KONG’S stock market regulator has filed a lawsuit against major banks Standard Chartered and UBS AG along with consultancy firm KPMG over a 2009 initial public offering (IPO) on the city’s bourse, AFP reported yesterday.

    Hong Kong’s Securities and Futures Commission (SFC) on Monday filed documents to the High Court alleging “market misconduct” in connection with China Forestry Holdings’s IPO, worth US$217 million, and the firm’s financial statements for 2009 to the first half of 2010.

    Policy on listed firms’ debt financing examed

    CHINA’S regulators are examining the official policy governing listed firms’ debt financing practices, Xinhua said Tuesday, suggesting a regulatory review may be under way.

    The country’s listed firms have been increasingly making private debt placements — high-yielding bonds sold directly to institutional investors in one-to-one deals — which are risky because their pricing is not subject to market scrutiny. The debt was also issued by firms in economic sectors which accounted for much of the rise in corporate defaults in 2015. The bar for financing by listed firms is set lower than for private firms, so the volume is larger which has led to illegal practices, Xinhua said.

    Yonghui Superstores, Bain to buy Daymon

    SHANGHAI-LISTED supermarket chain operator Yonghui Superstores Co. yesterday said it would team up with Bain Capital Private Equity to buy U.S. retail services group Daymon Worldwide Inc. for US$413 million.

    Yonghui Superstores will invest US$165 million for a 40 percent stake in Daymon, while Bain Capital will buy 60 percent, Yonghui Superstores said in a statement. It said it would fund the deal by bank borrowing and cash.

    Money market rate jumps

    CHINA’S benchmark money market rate yesterday surged the most in 19 months, with record central bank cash injections being overwhelmed by demand before the Lunar New Year holidays.

    The People’s Bank of China put in a net 410 billion yuan (US$60 billion) through open market operations yesterday, the biggest daily addition since 2004. That brings the total injections so far this week to 845 billion yuan. The interbank seven-day repurchase rate jumped 17 basis points, the most since June 2015, to 2.58 percent yesterday afternoon in Shanghai, according to weighted average prices.