China regulator gives nod to two IPOs amid volatility

A man watches a board showing stock prices at a brokerage office in Beijing, China, on July 1, 2015.
A man watches a board showing stock prices at a brokerage office in Beijing, China, on July 1, 2015.PHOTO: REUTERS

BEIJING • China's stock regulator yesterday said it had approved two initial public offering (IPO) plans, the first such deals authorised after the stock market last week suffered its biggest one-day fall since the global financial crisis.

The authorities have rolled out a raft of measures apparently aimed at stabilising the market this week but trading has been volatile.

Key indexes fell more than 4 per cent yesterday after rising around 7 per cent the day before.

Reports said the China Securities Regulatory Commission (CSRC) was considering halting IPOs, given worries over the market.

In a statement on its website, the CSRC said it had approved listing plans by medium-sized lender Bank of Jiangsu and Zhoushan Port, a port operator and developer based in Zhejiang province.

Neither of the companies has disclosed fund-raising targets but Zhoushan Port said the offering was to fund a project and replenish capital worth a total of 614 million yuan (S$133 million).

Chinese equity markets have fallen around 20 per cent from their peak in the middle of last month, when a year-long rally fuelled by cheap money shuddered to a halt as a crackdown on leveraged stock trading triggered panic selling.

Beijing has pushed through a number of measures that appear targeted at stabilising sentiment in a market dominated by individual investors prone to mood swings.

Regulators have unveiled rules to let local government pension funds buy stocks for the first time, potentially channelling hundreds of billions of yuan into the market.

China's securities regulator has suspended IPOs eight times in the history of the yuan-denominated A-share market, five of which were imposed since 2000, Bloomberg quoted a Xinhua report in April 2013 as saying.

REUTERS

A version of this article appeared in the print edition of The Straits Times on July 02, 2015, with the headline 'China regulator gives nod to two IPOs amid volatility'. Print Edition | Subscribe