China’s stock exchanges are considering revising underwriting rules for Shanghai’s Star Market and Shenzhen’s ChiNext board.
The China Securities Regulatory Commission is seeking comments from securities houses for the proposed changes. The updates include relaxing the targets for one-on-one roadshows from strategic investors to potential investors with significant investment strength, as well as no longer requiring the range of the IPO to be published in the investment research report from the lead underwriter.
The Shenzhen and Shanghai stock exchanges are also separately seeking public comments for their own draft rules.
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China has passed a data privacy law, called the Personal Information Protection Law, effective from November 1.
The law prohibits companies from over collecting data, illegal trading, providing or publishing personal data, and requires distinctive marks on surveillance equipment installed in public places.
The law adds to China’s strengthening regulation on data security. In June, the country also passed the Data Security Law, which will be effective on September. Last week, the Chinese government also released rules regulating data security in the automotive industry.
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Financial technology company Ant Group published a statement on its official WeChat account on Sunday, clearing up rumours about government officials taking up shares in the firm.
Ant said it had strictly followed laws and regulations in both Mainland China and Hong Kong when it attempted to list on the stock exchanges in both places. It said there were no government officials taking its shares, or sudden buying and selling of its shares.
The statement came after rumours circulated about a former Hangzhou official, Zhou Jiangyong, and his family spending Rmb500m ($76m) to buy stock of a “Zhejiang fintech company”, assumed to be Ant, before its IPO but being refunded after the deal failed. Ant was forced to scrap its landmark Hong Kong and Mainland China listing in November 2020 due to pressure from onshore regulators.
Zhou allegedly committed disciplinary and legal violations, and is now under investigation by China's Central Commission for Discipline Inspection and the State Supervision Commission.
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Hong Kong Exchanges and Clearing plans to launch its first China A-share derivatives product in October.
The HKEX said it has entered into an agreement with MSCI to launch a futures contract based on the MSCI China A 50 Connect Index on October 18. The contract will provide international investors with a risk management tool to manage their portfolio of Stock Connect eligible A-shares.
The 50 Connect Index tracks the performance of 50 key Shanghai and Shenzhen stocks available via Stock Connect, with at least two stocks from each sector.
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The People’s Bank of China kept its corporate and household loans interest rate benchmark unchanged for the 16th month in August. The one-year and five year loan prime rates (LPR) remained at 3.85% and 4.64% respectively.
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The China Securities Depository and Clearing Corp published July data showing there were 1.6m new securities investors, down 33.69% year-on-year.
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FTSE Russell has included 71 new A-shares in the FTSE Global Equity Index Series following an interim review.
The shares include 11 large cap stocks, 12 medium cap stocks, 41 small cap stocks and seven micro cap stocks.
It has also decided to exclude four stocks from the index, including a large cap stock, Oriental Yuhong, a company that makes waterproof materials.
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Five Chinese banks, Bank of Communications, China Construction Bank, Huaxia Bank, Industrial Bank and Postal Savings Bank of China, have been fined a total of Rmb15.4m by the People’s Bank of China for allegedly violating account management rules.
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The National Development and Reform Commission has announced the credit rating review result of corporate bond underwriters for 2020. Some 25 securities houses have been classified as class A underwriters, 46 as class B underwriters and 13 as class C.
The NDRC added that class C securities houses will be banned from taking the lead underwriter position for high quality corporate bonds until the next credit rating review.