News

China Huarong (2799): Party like it's 1949
Company announcement, 10-Dec-2018
"The Party Committee shall play the core leadership role...The chairman of the board of directors shall concurrently serve as the secretary of the Party Committee". Good to see the ongoing deepening of market reforms and opening up!
SFC fines SFM HK Management Ltd HK$1.5m for accidentally short-selling bonus shares of Great Wall Motor (2333)
SFC, 6-Dec-2018
After Great Wall Motor (2333) went ex a 2:1 bonus issue, SFM accidentally sold its bonus shares before they were issued. This is another reminder that bonus issues in effect temporarily delist part of the company, in this case, 2/3, because only the pre-bonus shares are tradeable between the ex-date and the delivery date. In September, the SFC fined Huatai Financial Holdings Ltd HK$800k for doing the same thing on the same bonus issue.
CMBC Capital (1141) lends another HK$150m
Company announcement, 30-Nov-2018
They don't name the borrower. We can tell you it is China New Higher Education (2001), to which CMBC has already lent HK$340m. CMBC has also lent CNHE's controlling shareholder HK$100m. On the new loan, CMBC vaguely states the interest rate of "5% to 10%" with an arrangement fee of "1% to 5%". In our view this fails to disclose sufficient details of the Disclosable Transaction.
SFC takes H&H (1112) and its Chairman to MMT over late disclosure
SFC, 29-Nov-2018
The SFC alleges that the respondents withheld Inside Information for a month until a profit warning on 23-Jul-2015.
Ex-Hospital Authority doctors charged with misconduct in public office and theft
ICAC, 28-Nov-2018
All of them are opthalmologists. They allegedly referred public patients of Caritas Medical Centre to a private clinic operated by 2 of them who are brothers.
Chairman of Huarong Inv (2277) resigns immediately due to "personal reason"
Company announcement, 27-Nov-2018
This comes hours after 3 resignations at its parent, China Huarong Asset Management (2799).
Landing (0582) Chairman Yang Zhihui "has resumed his duties"
Company announcement, 26-Nov-2018
After 3 months AWOL, Mr Yang has "explained that he has been assisting the relevant department of the [PRC] with its investigation". No word on where he is or whether the HK SFC's freeze of his brokerage accounts is still in effect.
Wong Tai Sin District Councillor jailed for HK$15k salary payments fraud
ICAC, 22-Nov-2018
Joe Chan Yim Kwong kept claiming salary reimbursement of $5k per month for 3 months after his part-time assistant had quit.
SFC directs suspension of Hua Han Health (0587)
SEHK, 20-Nov-2018
It's been suspended since 27-Sep-2016 when it first missed a results deadline.
Companies Registry illegally overcharged users HK$3.6bn
Webb-site.com, 19-Nov-2018
The CFA has ruled that Trading Funds must not seek distributable profit or pay "notional tax". Webb-site finds that the Companies Registry has overcharged users HK$3.6bn since 1998, making up to a 94% return on fixed assets against a target 5.7%. The illegal excess should now be returned by waiving fees, including scrapping the Great Paywall of HK on corporate information. It should not take another judicial review to do so.
41 endangered stocks
Webb-site.com, 17-Nov-2018
If HKEX proceeds with an ill-conceived Listing Rule change, companies with disclaimed audit reports for 2019 will be suspended and likely delisted, victimising minority shareholders. We now list those with disclaimed audits up to 30-Jun-2018 which would be affected if the rule applied today. Make your submission to stop this nonsense!
HKICPA fines Miss Lee Po Chi and Deloitte Touche Tohmatsu HK$50k each
HKICPA, 13-Nov-2018
Over bad audit work on Culturecom (0343) regarding its stake in China Bio Cassava (8129), now known as Cloud Investment Holdings Ltd.
HKICPA fines Mr Law Ka Lok & Latitude CPA Ltd jointly HK$40k
HKICPA, 6-Nov-2018
In a classic "the dog ate my homework" excuse, Latitude claimed that there had been unauthorised deletion and consequent permanent loss of audit documentation on the firm's computer server. So in essence, they were fined for not having backups.
Freedom and the future of China
Webb-site.com, 30-Oct-2018
This is the text of a High Table dinner speech delivered by Webb-site founder David Webb to the students of Chi Sun College, University of Hong Kong, this evening. Hyperlinks have been added.
Concentration warning in Furniweb (8480)
SFC, 30-Oct-2018
The top 20 holders have 91.43% of the company.
A deeper dive into CMBC, CSPT and FWF
Webb-site.com, 21-Oct-2018
After raw-nerve responses from CMBC Capital (1141) and China Soft Power Technology (0139) to our Huarong-CMB network diagram, we zoom in on their network and also look at CMBC's exposure to the controller of 3 more listed companies.
The Huarong-CMB network: 26 stocks not to own
Webb-site.com, 19-Oct-2018
In our first circuit diagram since the infamous Enigma Network, we examine the overlapping networks, bubbles and funding surrounding 26 HK-listed companies that your portfolio would probably do better without.
Freeman (0279) renegotiates US$99m convertible held by 51% subsidiary of China Huarong (2799)
Company announcement, 18-Oct-2018
This comes 20 days after they renegotiated the other HK$429m CB held by Huarong Inv (2277) which is also a subsidairy of China Huarong. The conversion price of both is reduced from $0.425 to $0.065.

Our stories

Companies Registry illegally overcharged users HK$3.6bn
The CFA has ruled that Trading Funds must not seek distributable profit or pay "notional tax". Webb-site finds that the Companies Registry has overcharged users HK$3.6bn since 1998, making up to a 94% return on fixed assets against a target 5.7%. The illegal excess should now be returned by waiving fees, including scrapping the Great Paywall of HK on corporate information. It should not take another judicial review to do so. (19-Nov-2018)
41 endangered stocks
If HKEX proceeds with an ill-conceived Listing Rule change, companies with disclaimed audit reports for 2019 will be suspended and likely delisted, victimising minority shareholders. We now list those with disclaimed audits up to 30-Jun-2018 which would be affected if the rule applied today. Make your submission to stop this nonsense! (17-Nov-2018)
Freedom and the future of China
This is the text of a High Table dinner speech delivered by Webb-site founder David Webb to the students of Chi Sun College, University of Hong Kong, this evening. Hyperlinks have been added. (30-Oct-2018)
The Huarong-CMB network: 26 stocks not to own
In our first circuit diagram since the infamous Enigma Network, we examine the overlapping networks, bubbles and funding surrounding 26 HK-listed companies that your portfolio would probably do better without. (19-Oct-2018)
Huarong and China Singyes Solar Technologies (0750)
CSST, now suspended pending disclosure of its financial position, has failed to disclose in its reports the interest of Huarong Int Fin (0993), which claims to have a 15.09% interest, including 8.04% purchased from an unknown vendor in Dec-2017 and security over a further 7.05% pledged to it, presumably to secure a put option that it claims to have been granted. By whom? (18-Oct-2018)
The Princeton economist and a plot in Sheung Wan
A tiny plot of prime HK land left behind in a company dissolved in 1972 is now a potential windfall in a redevelopment of its surroundings. For 54 years, Professor Gregory Chow never knew he had a stake in it. (8-Oct-2018)
China First Capital (1269) and a questionable joint venture
Webb-site finds serious problems with CFC's statements about a GBP60m UK start-up joint venture with a BVI company, the owner of which is not disclosed, which has only partly paid for its share of the JV. (7-Oct-2018)
Breaking: SFC freezes up to HK$10.17bn of assets in 3 brokers
Webb-site has deduced that these are assets of Mr Yang Zhihui, missing Chairman and majority shareholder of Landing (0582), and that he is reasonably suspected of fraud causing losses of HK$10.17bn to China Huarong (2799), the ex-Chairman of which is under a corruption investigation in China. We also turn the spotlight on China Goldjoy (1282) which was an enthusiastic buyer of Landing at prices far higher than its Chairman paid beforehand. (1-Oct-2018)
HKEX: shoot patients to prevent illness
HKEX's proposal to suspend and then delist companies with disclaimed audits works against investor interests in several ways while doing nothing to address the root causes of corporate illness. In a partial revival of the 2002 Penny Stocks proposals, the self-interest of HKEX in ditching unprofitable business cannot be ignored. We again call for the regulatory function to be transferred to the SFC and HKEX's monopoly to be abolished. Only when there is competition can they pick and choose their customers. HKEX fails to name the 43 firms that would have been suspended on their 2017 audits. Answers by Tuesday morning, please! (30-Sep-2018)
Who showed up? A simple change to the Listing Rules
Announcements of AGM/EGM outcomes should include directors' attendance. We shouldn't have to wait for the next annual report to find out who showed up. (9-Sep-2018)

Other news

China Huarong (2799): Party like it's 1949
Company announcement, 10-Dec-2018
"The Party Committee shall play the core leadership role...The chairman of the board of directors shall concurrently serve as the secretary of the Party Committee". Good to see the ongoing deepening of market reforms and opening up!
SFC fines SFM HK Management Ltd HK$1.5m for accidentally short-selling bonus shares of Great Wall Motor (2333)
SFC, 6-Dec-2018
After Great Wall Motor (2333) went ex a 2:1 bonus issue, SFM accidentally sold its bonus shares before they were issued. This is another reminder that bonus issues in effect temporarily delist part of the company, in this case, 2/3, because only the pre-bonus shares are tradeable between the ex-date and the delivery date. In September, the SFC fined Huatai Financial Holdings Ltd HK$800k for doing the same thing on the same bonus issue.
CMBC Capital (1141) lends another HK$150m
Company announcement, 30-Nov-2018
They don't name the borrower. We can tell you it is China New Higher Education (2001), to which CMBC has already lent HK$340m. CMBC has also lent CNHE's controlling shareholder HK$100m. On the new loan, CMBC vaguely states the interest rate of "5% to 10%" with an arrangement fee of "1% to 5%". In our view this fails to disclose sufficient details of the Disclosable Transaction.
SFC takes H&H (1112) and its Chairman to MMT over late disclosure
SFC, 29-Nov-2018
The SFC alleges that the respondents withheld Inside Information for a month until a profit warning on 23-Jul-2015.
Ex-Hospital Authority doctors charged with misconduct in public office and theft
ICAC, 28-Nov-2018
All of them are opthalmologists. They allegedly referred public patients of Caritas Medical Centre to a private clinic operated by 2 of them who are brothers.
Chairman of Huarong Inv (2277) resigns immediately due to "personal reason"
Company announcement, 27-Nov-2018
This comes hours after 3 resignations at its parent, China Huarong Asset Management (2799).
Landing (0582) Chairman Yang Zhihui "has resumed his duties"
Company announcement, 26-Nov-2018
After 3 months AWOL, Mr Yang has "explained that he has been assisting the relevant department of the [PRC] with its investigation". No word on where he is or whether the HK SFC's freeze of his brokerage accounts is still in effect.
Wong Tai Sin District Councillor jailed for HK$15k salary payments fraud
ICAC, 22-Nov-2018
Joe Chan Yim Kwong kept claiming salary reimbursement of $5k per month for 3 months after his part-time assistant had quit.
SFC directs suspension of Hua Han Health (0587)
SEHK, 20-Nov-2018
It's been suspended since 27-Sep-2016 when it first missed a results deadline.
HKICPA fines Miss Lee Po Chi and Deloitte Touche Tohmatsu HK$50k each
HKICPA, 13-Nov-2018
Over bad audit work on Culturecom (0343) regarding its stake in China Bio Cassava (8129), now known as Cloud Investment Holdings Ltd.
HKICPA fines Mr Law Ka Lok & Latitude CPA Ltd jointly HK$40k
HKICPA, 6-Nov-2018
In a classic "the dog ate my homework" excuse, Latitude claimed that there had been unauthorised deletion and consequent permanent loss of audit documentation on the firm's computer server. So in essence, they were fined for not having backups.
Previously on Webb-site.com
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