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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Keira Lu Huang
08 August 2015
The State Council has finally approved an ambitious – and long-awaited – blueprint to overhaul China’s sclerotic state-owned enterprises in a Singapore-inspired quest for desperately needed new growth, sources close to the decision-making process said.
The shake-up is expected to be the biggest of its kind in more than a decade and once it’s done two new Temasek-style sets of companies will channel funds to SOEs and pressure them to turn a profit.
In return, SOEs will be able to make more of their own business decisions and their boards of directors will be able to hire and fire managers.
But party leadership sent by the State Council’s State-owned Assets Supervision and Administration Commission (Sasac) to SOEs remains unchanged.
The new system will aim to put greater distance between government and the day-to-day commercial operations of state firms, with the Sasac no longer directly intervening in the running of most SOEs.
The Communist Party first outlined plans for the overhaul at its agenda-setting annual plenum two years ago but progress was stalled by vested interests in the firms and various government departments.
Details of the blueprint are still scant but it is expected to change the way SOEs – which account for a quarter of the mainland’s economy – are supervised and financed to give them more flexibility to make their own operational decisions.
It will also elaborate on the previously released principles to push for mergers of some state firms to enhance competitive power in global market, cut perks for top executives, and give private capital more room to invest in SOE projects and offshoots.
It was hoped the changes would light a fire under the state sector to counter a slowdown in economic growth, analysts said, adding that policymakers were keep to push ahead despite the strong internal opposition.
A government source told the South China Morning Post that “ state-owned capital operating companies” would be set up to allocate state funds to monopolistic SOEs in mission-critical sectors, and will manage investment, financing and construction with the state-owned capital.
Capital investment companies would also be created to allocate state funds to market-driven SOEs and mainly manage the SOEs’ stock rights rather than run the industry directly.
According to the principle released after the party’s third plenum, the two new sets of companies could be formed through one SOE or bundling several to be restructured into one investment company.
Sasac could be left in charge of several vital companies but the top leadership had still not made a final decision, the source said.
“Nevertheless, under the new system, the source of funding will be clearer than ever and the capital investment and operating companies will have to generate certain returns to preserve and increase the value of state assets.”
Li Jin, Sasac’s leading expert studying SOE reform, said the restructure would cut government intervention and give SOEs more scope to chart their own commercial course.
“It’s an efficient way to separate political and business goals,” said Li, who is also deputy head of the think tank, the China Enterprise Reform and Development Society.
One SOE executive said the new companies were modelled on Temasek, Singapore’s government-owned investment company. Under the new system, SOEs would be under the pressure to perform and be more attractive to private sector investment.
“It will introduce a significant change to state-asset management and give private money a chance,” the executive said. “The market and the SOEs’ performance will determine where the capital flows.”
Li said it was likely that SOEs would be grouped into various industries and each would have its own rules for privatisation.
“Once the overall blueprint is released, guidance on changes in specific areas will come out,” he said.
Hang Seng Bank senior economist Andy Yao Shaohua said developing mixed ownership was key to the future of state enterprises.
“Introducing private capital can rebalance the status quo because now the proportion of state-owned shares is still too high,” Yao said.
Nevertheless, the changes to the massive state sector – which encompasses enterprises and employees – will not be easy, if precedent is any guide.
The last time the party sought to reinvent state-owned enterprises on such a vast scale was in the late 1990s under the stewardship of then premier Zhu Rongji .
Between 1998 and 2002 Zhu took a huge gamble on social stability as about six million people lost their jobs during a restructuring drive that shut down thousands of state firms.
Li, from the China Enterprise Reform and Development Society, said the dust had still not settled over the proposed changes.
“There will be disputes everywhere since the plan will change the current distribution of power, money and resources,” he said. “There are disputes between state departments, within SOE management, between government agencies, and between central and local state-owned enterprises.”
The blueprint is expected to be discussed by party leaders gathering at the seaside resort of Beidaihe, government sources said.