New Regulations to Ban Speculative Stock Issues

You make me want to be a better man. Your position:Home->china news-> New Regulations to Ban Speculative Stock Issues China will soon issue rules to ban mainland-listed companies from using stock-sale proceeds to invest in initial public offerings. The proposed regulation has scuttled a plan by Financial Street Holding Co to invest capital in new stock subscriptions using capital raised earlier, the Shenzhen-listed firm said in an exchange filing on Wednesday. Public firms will also be prohibited from investing the money they raise from stocks, convertible bonds and upcoming financial derivatives, according to the statement. The funds can be used only as originally planned, such as replenishing working capital to focus on the firms' core businesses, the statement said. A spokesman for the China Securities Regulatory Commission declined to comment on the issue Thursday. China's benchmark Shanghai Composite Index soared 130 percent last year and continues to rise on improved market fundamentals and restored investor confidence. Domestic citizens have been diverting bank savings to securities investments in pursuit of higher returns. Many invest in new stocks as mainland firms usually feature staggering trading debuts amid abundant liquidity. So far this year, more than 20 listed companies have used 10 billion yuan (US$1.29 billion) from their stock-sale proceeds to subscribe to IPOs, the Securities Times reported Thursday, citing its own calculation. Chinese authorities are preparing to urge listed firms to beef up information disclosures and adopt new accounting standards as part of efforts to enhance corporate governance. (Shanghai Daily March 16, 2007) Contact Us-------------------------------------ddpcn.com * Required information Full Name: * Your Email: * Message:* Preview:Over 1 Mln Accounts Ope      Next:Local Gov'ts Ordered to Intercity Subway About to Get Rolling SGL Group to Benefit from Push for Renewable Energy Haier Joins Venture for HDTV Sales Guangzhou Port Becomes World's Fifth Largest Local Gov'ts Ordered to Scrap Old Cement Factories Over 1 Mln Accounts Open in Post-festival Stock Frenzy QFIIs Lose Money on China Stock Market in February ChinaGas, SKCorp. Team up to Explore Global Gas Market Citibank Launches Financing Innovation Forum for SMEs Mercedes-Benz's China Sales Up 52% in First 2 Months