China’s CSRC May Relax Rules on Further IPOs in Hong Kong, Yao Gang Says

China will consider relaxing overseas listing rules to encourage smaller Chinese companies to sell shares in Hong Kong, a top official at the nation’s securities regulator said.

Standards to list so-called H shares are too high and the approval process is time-consuming, Yao Gang, vice chairman of The China Securities Regulatory Commission, said at a conference in Hong Kong today. A relaxation will help private companies and small-to-medium enterprises in China to sell stock, he said.

“Current H-share listing rules were set more than a decade ago, and there haven’t been changes throughout these years,” Yao said. “This year, the CSRC will conduct a comprehensive revision on overseas listing rules,” Yao said.

Premier Wen Jiabao said on Dec. 20 that many enterprises are suffering from higher credit costs, after gross domestic product grew at the slowest pace since 2009 in the third quarter. Six-month interbank borrowing rates in Shanghai have risen to 5.42 percent, up from 3.66 percent on Jan. 17 last year, according to data compiled by Bloomberg.

First-time share sales by Chinese companies overseas raised $15.3 billion last year, down 58 percent from 2010 and hitting a three-year low, Bloomberg data show. There were 59 such deals last year, compared with 124 in 2010, the data show.

In Hong Kong, first-time offerings by Chinese companies raised $13.1 billion last year, a 59 percent decline from 2010, according to Bloomberg data.

To contact the reporters on this story: Sophie Leung in Hong Kong at sleung59@bloomberg.net; Fox Hu in Hong Kong at fhu7@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

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