TWO former senior employees of UOB Kay Hian Private Limited (UOBKH) were charged on Wednesday for allegedly lying to the Monetary Authority of Singapore (MAS) in relation to reports on a then Catalist aspirant. Lan Kang Ming, 38, and Wee Toon Lee, 34, each face three charges of providing MAS with false information in October 2018 in relation to due diligence reports on an unidentified company applying to list on the Catalist board of the Singapore Exchange. MAS said in a media statement on Wednesday that it was performing an onsite inspection of UOBKH between June and August 2018, to assess the latter's controls, policies and procedures in relation to its role as an issue manager for Initial Public Offering (IPOs). During the examination, Lan and Wee were said to have provided different versions of a due diligence report relating to background checks on a company applying to be listed on the Catalist board of the Singapore Exchange. UOBKH had acted as the issue manager
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By LYNN KAN
25 May 2011
Shares of Cosco Corporation (S) staged a recovery yesterday after it steered clear of a China audit report on financial irregularities at its Chinese parent company.
Analysts here do not believe that the Chinese National Audit Office (NAO) report on the financial affairs of Chinese state-owned enterprises (SOEs), including Cosco (S)’s parent, will harm the S-chip’s standing as a well-traded stock. (S-chips are Chinese companies listed in Singapore.)
They say the fundamentals count more: whether Cosco (S) lands more orders, and how well it moves into rig-building.
Cosco (S) shares came under selling pressure on Monday as investors sold the stock in a knee-jerk reaction, unsure what the NAO report meant for Cosco (S). The stock plunged 14 cents, or almost 7 per cent, to $1.89, prompting Cosco (S) to make an after- market clarification that the S-chip was not implicated in the report. Yesterday’s recovery saw Cosco (S) recoup eight cents to end at $1.97.
Following the NAO report, Cosco Group is said to have since adjusted its financial records and reports.
Now that Cosco (S) has cleared its name, analysts and investors say what matters more is the S-chip’s core business and improving execution, rather than the spectre of poor corporate governance.
Some have noted that indicators of irregularities - such as auditors quitting - have not happened there.
‘It is the parent company, not Cosco Corp! Cosco Corp’s announcement to clear the air should remove investors’ concerns over the accounting irregularities issue,’ wrote DBS Vickers in a note yesterday.
It sees fresh contract wins from Sevan worth US$1.05 billion, KS Energy worth US$350 million, and Frigstad worth US$1.1 billion. ‘Current share price weakness presents a good opportunity to buy ahead of new contract wins,’ it said.
Although the NAO report had initially sparked fresh worries over corporate governance standards at S-chips, DMG Partners analyst Tan Han Meng doubts the shine for S-chips will come off permanently because of the report.
‘Financial irregularities are not an S-chip specific problem,’ he said. ‘Recent cases in Hong Kong and in the US have shown that it is not possible to have absolute assurance.’
Mr. Tan believes that corporate governance at S-chips will inevitably improve given time. ‘At this point, when it’s much harder for companies to get funds, companies need to either come clean or suffer a steeper discount to its share price,’ he said.