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Fosun denies reports China regulators asked banks to report exposure to it

Stock Markets Sep 14, 2022 12:00AM ET
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© Reuters. A sign is seen on a building of the headquarters of Fosun International, in Shanghai, China, March 29, 2016. REUTERS/Aly Song/File Photo

SHANGHAI (Reuters) -Fosun International said on Wednesday that media reports saying Chinese regulators have told the country's biggest banks to start a round of checks on their financial exposure to the Chinese conglomerate were false.

Bloomberg, citing people familiar with the matter, reported on Tuesday that regulators including the China Banking and Insurance Regulatory Commission (CBIRC) had requested that commercial banks check their exposure to Fosun's debt and understand potential liquidity risks.

Shares in the company slumped as much as 7.55% on Wednesday to HK$4.53, near a 10-year low.

Fosun said in a statement such reports were "sheer nonsense" and that it had sought confirmation from regulators through multiple channels. The CBIRC has not asked banks about their financial exposure to Fosun and many banks that cooperate with Fosun have not received such a notice, the company said.

The "complex external environment" has increased public attention towards Fosun's recent asset sales and stake reductions, resulting in a "one-sided interpretation" of the company's actions, Fosun's Chief Financial Officer Gong Ping said in the statement.

"Fosun's recent seemingly frequent reductions and sales are a continuation of its financial strategy of the past few years of maintaining a balance between investments and withdrawals," he said.

CBIRC has not responded to Reuters request for comment.

Fosun owns resorts brand Club Med and controls French fashion house Lanvin among other assets. It was previously one of China's most acquisitive dealmakers until Beijing's crackdown on flashy overseas acquisitions a few years ago.

The company has so far this year agreed to sell its 4.89% stake in Tsingtao Brewery Co Ltd and is also reducing its stake in Fosun Tourism.

Fosun denies reports China regulators asked banks to report exposure to it
 

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