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 issu...
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R Sivanithy
03 July 2015
China Fibretech shares, which underwent a 50-into-one consolidation in May, have undergone hugely volatile trading this week, prompting dealers to once again question the wisdom of forcing companies to undergo share consolidation to meet the Singapore Exchange’s new minimum trading price (MTP) of S$0.20.
The company on March 28 said that the consolidation was to enable it to satisfy SGX’s MTP and to reduce speculation and volatility in its share price. Based on the price of S$0.0331 on May 25 which was the day before the consolidation took effect, China Fibretech’s post-consolidation price should have been around S$1.65. The stock opened at that price on May 26 but closed at S$1.63.
Between May 26 and July 1, the stock traded between S$1.51 and S$1.61. On July 1, it plunged S$0.43 or about 27 per cent to S$1.18 on volume of 337,400 shares. This prompted a query from SGX for reasons behind the plunge. After the company replied that it did not know of reasons for the fall, the exchange issued a “Trade With Caution” on the stock.
On Thursday, the counter went to a high of S$1.48 before plunging in late afternoon trades to S$1.03, triggering the SGX’s 10-minute circuit breaker. After resumption, the stock collapsed to S$0.92, triggering the circuit breaker again. It eventually closed at S$1.195, a net gain of S$0.015 for the day on volume of 18,900 shares.
“It’s ironic that the company’s goal was to reduce volatility but the result is massive volatility,” said a dealer. “This is a direct outcome of forcing a penny stock to appear as if it is a blue chip.” Many other remisiers BT spoke with agreed, with one saying: “Imagine the amount of shareholder wealth that has been destroyed.”
The SGX’s MTP came into effect in March and is aimed at pushing companies with depressed share prices to turn their businesses around, thus injecting greater quality into the local market. Companies have three years to comply or be placed on a watch-list. Alternatively, they can downgrade their listing to Catalist.