HONG KONG (REUTERS) - CITIC Resources Holdings Ltd said on Tuesday that metal it stores at China's Qingdao port may be affected by a probe into suspected fraud, the latest in series of global banks and trading houses potentially caught up in the scandal.
The investigation at the port, where a third-party firm is suspected of using single cargoes of metal multiple times to obtain financing, has also rattled markets as worries deepen over whether problems could extend to other ports and curb the use of metal as collateral for financing.
The investigation into the status of aluminium and copper products stored at port may hit the group, CITIC Resources said in a filing to the Hong Kong bourse.
CITIC Resources' commodities import and export business owns some alumina and copper stored in bonded warehouses at the Qingdao port, the world's seventh busiest.
"At present, the status of the investigation is unknown to the group," chairman Kwok Peter Viem said in a filing to the Hong Kong stock exchange.
"Until the status of the investigation is clarified, the company is not able to accurately assess its impact on the group's alumina and copper stored at Qingdao port or on the group itself," Kwok added.
But to protect its interests, Citic had applied to the Qingdao courts on June 3 to obtain sequestration orders in respect of the group's alumina and copper. It did not elaborate.
Citic is 59.4 percent-owned by CITIC Group Corp, China's biggest and oldest financial conglomerate, and 11.46 percent-owned by Singapore state fund Temasek Holdings.
The group joins Standard Bank Group and a part-owned unit of Louis Dreyfus Corp, Singapore-listed GKE Corp., which warned last week of potential losses.
Standard Chartered has said it reviewing metals financing to a small number of companies in China while Citi Group said it would work closely with authorities, warehousing companies and clients to resolve any issues.
Citic said it was not in a position to provide any other information on the impact of the investigation on its alumina and copper business.