The shares earlier fell as much as 17 percent.
Advertisement
Performance was mixed among main sectors, with IT and industrial stocks rising, but energy and property shares falling.
The developments at Guotai Junan global coincide with a stock market clampdown in China that has seen officials at the securities regulator, senior staff at Citic Securities (Other OTC: CIIHF – news), and a top fund manager caught up in investigations.
“The company has been unable to reach Dr. Yim Fung, Chairman of the Board… since 18 November 2015”, the company said in a statement filed to the stock exchange.
Hong Kong shares were nearly flat, with investors increasingly relaxed about the prospect of higher US interest rates next month and looking for fresh cues on direction.
Yim, a graduate of China’s prestigious Tsinghua University who joined the company in 1993, is the firm’s fourth-biggest shareholder with a stake of 0.59 per cent, the data shows.
Yim’s disappearance follows the investigation of Yao Gang, a vice-chairman at the China Securities Regulatory Commission, and a former Guotai Junan executive. Ronald Wan, at Partners Capital worldwide in Hong Kong, warned: “Investors will be concerned … It will also affect sentiment over the brokerage industry as a whole as the industry is now under greater scrutiny”.
Mr Yim has been a member of the Inner Mongolia arm of the Chinese People’s Political Consultative Conference, a state advisory body.
Guotai Junan has risen 69% this year.
At least 16 people had been arrested or were under investigation as part of the regime’s crackdown, according to research reported by Bloomberg.
Those being probed at Citic Securities include president Cheng Boming.
At Guotai Junan global, Qi Haiying, a director and a deputy CEO, will be temporary chairman, the company said.
“The general supervision and operation of state-owned enterprises is done by the government, so the chairman’s impact on a company is not very large”, said a brokerage analyst in Shanghai who declined to be named because of the sensitivity of the topic.
Advertisement
Guotai Junan has charged deputy chief exec, Wong Tung Ching, with leading the company in Fung’s absence.
