Country Garden shares slide after CFO quits

BEIJING • Chinese developer Country Garden Holdings tumbled the most in more than nine months after its chief financial officer resigned in what one analyst called a "surprise" move. Country Garden shares slumped as much as 6.9 per cent to HK$3.92 (S$0.73) in Hong Kong morning trading, the most since March 15, and traded 1.2 per cent lower as of 1.16pm yesterday, Bloomberg has reported.

Mr Wu Jianbin, the firm's CFO since 2014, resigned to devote more time to personal interests, the firm said in a filing to the Hong Kong stock exchange late Wednesday. The 53-year-old's resignation came as "a surprise", as there were no indications from management about any potential change in senior personnel, Mr Raymond Cheng, a property analyst at CIMB Securities, wrote in a note dated Jan 4.

Country Garden named Ms Wu Bijun, 43, general manager of the firm's finance centre, as Mr Wu's replacement from April 1, according to the filing.

The change is a "slight negative", given Mr Wu's strong credentials, Morgan Stanley Hong Kong-based analyst John Lam wrote in a note. Mr Wu joined Country Garden after 13 years at rival builder China Overseas Land & Investment.

Foshan-based Country Garden more than doubled contracted sales to a record 288.1 billion yuan (S$60.02 billion) in the first 11 months of last year, from 113.2 billion yuan in 2015, said the filing. It was also the most aggressive buyer of development sites, buying a total 74.5 million sq m last year, China Real Estate Information data show.

Mr Wu had pledged to shore up Country Garden's balance sheet after joining the firm in 2014. In 2015, he vowed to win an investment-grade rating by lowering the firm's debt ratio below 70 per cent.

The developer's net debt-to-equity ratio, a measure of indebtedness, declined to 59.6 per cent at the end of 2015, the lowest level since 2009, according to data compiled by Bloomberg.

Country Garden is rated two levels below investment grade by both Moody's Investors Service and Standard & Poor's.

A version of this article appeared in the print edition of The Straits Times on January 06, 2017, with the headline 'Country Garden shares slide after CFO quits'. Print Edition | Subscribe