A healthy sign of political will and how regulators are getting on top of things is reflected by an ongoing probe into several of China's largest overseas asset buyers, said an investor on Tuesday.
Amid a government crackdown on money laundering ahead of the 19th party congress later this year, reportedly placed under security last week were high profile Chinese companies, including billionaire Wang Jianlin's Wanda Group, Anbang Insurance and Fosun.
Its checks of loans to companies that made overseas acquisitions is routine, said lender Industrial and Commercial Bank of China, reported Reuters.
"At this stage, it's still very much a fact-finding exercise. Of course, it's causing a lot of anxiety in the market because people don't know what will be found, but I think it is a healthy sign that the regulators are getting on top of things to make sure that the anxieties in the market are being managed," said Victor Chu, chairman and CEO of First Eastern Investment Group, a Hong Kong-based private equity and venture capital firm.
State news agency Xinhua reported on Monday that the country will step up its monitoring of overseas investment, said a top-level meeting chaired by Chinese President Xi Jinping.
Chu said that the probe would help clear things up as there has been rampant speculation over issues such as "Why so much money has been spent in such a short period of time? Where does the money come from."
"There may be good reasons for that. The action is actually quite healthy...The rumor mills will come into play, which is what you will expect, but I think we should not prejudge that this is something which is sinister. I don't think it is sinister. I think it is part of a regulator stamping its authority in the market, particularly when some of these are supposed to be very politically well-connected (companies). This shows that there is a will at the top to get things right," he said.
Conducting such exercises more systematically is what can be improved on, Chu said.
"I think the anti-corruption exercise will be a fairly permanent one. I hope that there will be a more systematic approach with more transparency, (that) they will articulate what their plans are so that people know where they stand," he added.
He said that it's not easy to tell if a particular investigation is methodical, a one-off or permanent, now due to the sheer number of companies in China.
Chu was upbeat on what has been achieved in two decades ahead of the 20th anniversary of the handover of Hong Kong to China from the United Kingdom later this week.
"The 'one country, two systems' concept by and large has worked well. The rule of law is very, very much alive," he said.
"The Chinese government has given Hong Kong a lot of support. By and large, we enjoy the same freedom day to day. Hong Kong is thriving. I think we should look ahead with renewed confidence and hope," said Chu.
(Source:www.cnbc.com)
Amid a government crackdown on money laundering ahead of the 19th party congress later this year, reportedly placed under security last week were high profile Chinese companies, including billionaire Wang Jianlin's Wanda Group, Anbang Insurance and Fosun.
Its checks of loans to companies that made overseas acquisitions is routine, said lender Industrial and Commercial Bank of China, reported Reuters.
"At this stage, it's still very much a fact-finding exercise. Of course, it's causing a lot of anxiety in the market because people don't know what will be found, but I think it is a healthy sign that the regulators are getting on top of things to make sure that the anxieties in the market are being managed," said Victor Chu, chairman and CEO of First Eastern Investment Group, a Hong Kong-based private equity and venture capital firm.
State news agency Xinhua reported on Monday that the country will step up its monitoring of overseas investment, said a top-level meeting chaired by Chinese President Xi Jinping.
Chu said that the probe would help clear things up as there has been rampant speculation over issues such as "Why so much money has been spent in such a short period of time? Where does the money come from."
"There may be good reasons for that. The action is actually quite healthy...The rumor mills will come into play, which is what you will expect, but I think we should not prejudge that this is something which is sinister. I don't think it is sinister. I think it is part of a regulator stamping its authority in the market, particularly when some of these are supposed to be very politically well-connected (companies). This shows that there is a will at the top to get things right," he said.
Conducting such exercises more systematically is what can be improved on, Chu said.
"I think the anti-corruption exercise will be a fairly permanent one. I hope that there will be a more systematic approach with more transparency, (that) they will articulate what their plans are so that people know where they stand," he added.
He said that it's not easy to tell if a particular investigation is methodical, a one-off or permanent, now due to the sheer number of companies in China.
Chu was upbeat on what has been achieved in two decades ahead of the 20th anniversary of the handover of Hong Kong to China from the United Kingdom later this week.
"The 'one country, two systems' concept by and large has worked well. The rule of law is very, very much alive," he said.
"The Chinese government has given Hong Kong a lot of support. By and large, we enjoy the same freedom day to day. Hong Kong is thriving. I think we should look ahead with renewed confidence and hope," said Chu.
(Source:www.cnbc.com)
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