Bank of Jinzhou Delays Hong Kong IPO as Hanergy Link Queried

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Bank of Jinzhou Co. delayed its $600 million Hong Kong initial public offering as the stock exchange asked for information on the lender’s ties to a company that’s under investigation by regulators.

The bourse last week requested more information on items including some litigation proceedings and on the Chinese bank’s links to Hanergy Thin Film Power Group Ltd., board secretary Wang Jing said by telephone on Friday. The exchange’s initial feedback was positive after the bank addressed the queries, he said, without elaborating.

The lender has sold wealth-management products that invested in Hanergy’s debt, according to documents seen by Bloomberg. Hong Kong’s Securities & Futures Commission said May 28 it was investigating Hanergy, whose shares have been suspended since a 47 percent tumble on May 20.

The SFC has declined to speak about the specifics of its probe, while Hanergy, which makes equipment used to manufacture solar panels, hasn’t issued any statements detailing the reasons for the stock suspension.

Bank of Jinzhou, based in the city of Jinzhou in northeastern Liaoning province, hopes to conduct the hearing for its IPO with Hong Kong’s exchange in late July as it can’t be completed this month, Wang said. It will take several weeks to audit the bank’s first-half financial reports, he said.

Parent Company

The lender was founded in 1998 and has branches in 12 cities across northern and northeastern China, according to its website. It had 250.7 billion yuan ($40 billion) of assets as of Dec. 31, according to its annual report.

Reuters reported earlier that the lender’s IPO was delayed because of its link to Hanergy’s parent company. Bank of Jinzhou was seeking about $600 million from the sale, people with knowledge of the matter said in January. The company hasn’t publicly announced a fundraising target.

China’s more than 110 city commercial banks are seeking to replenish capital to expand beyond their home bases and compete with larger, better-funded rivals. The China Banking Regulatory Commission said in January it will form a separate unit to supervise these lenders, which controlled 13 percent of the nation’s $21 trillion of banking assets at the end of September.

— With assistance by Jun Luo

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