Shang Fulin, chairman of the China Securities Regulatory Commission (CSRC), said Thursday that the CSRC has not made any changes in its policies governing the stock listings of mainland firms in Hong Kong.
Shang's remarks was a response to earlier media reports that CSRC would not approve initial public offerings of mainland firms in Hong Kong unless the size of the IPO exceeds one billion US dollars or the firms plan spontaneous listings in the mainland and Hong Kong.
"China will continue to support Hong Kong as the international financial center," Shang said at a seminar at the Inaugural Annual Meeting of the New Champions hosted by the World Economic Forum in China's northeastern coastal city of Dalian.
"The news on the one billion US dollars threshold came from nowhere. The central government didn't make any changes and what changed is the market."
The mainland halted the yuan-denominated IPOs when it carried out share-holding reforms between May 2005 and mid-2006.
"Therefore, many large mainland commercial banks chose to get listed in Hong Kong as they badly need to raise money to supplement their capital in an effort to facilitate reforms," he noted.
The mainland stock markets picked up rally since 2006, ending years of slump, upon the completion of reforms that transformed controlling state-owned shares in most listed firms into tradable shares.
The benchmark Shanghai Composite Index rose 1.56 percent to 5,393.66 points on Thursday, more than doubling since the beginning of the year.
"Many companies opt to list in the mainland bourses as the IPO prices are higher than those in Hong Kong," Shang said.
Some firms are still likely to be listed in Hong Kong in the future for other purposes including boosting management models and corporate governance other than money-raising itself as the experience tells us, he noted.
Shang acknowledged that decisive factor behind the IPOs on the mainland is that the companies want to expand influence more effectively as their majority customers are from the mainland.
"The CSRC will respect the firms' choices and support them whether they choose to get listed in the mainland or Hong Kong," he added.
(Xinhua News Agency September 7, 2007)
