http://www.theaustralian.com.au/business/companies/no-yuan-proble...

http://www.theaustralian.com.au/bus...y/news-story/15199856cfde17d85cab52c1b949fba8



A group of Chinese companies listed on the ASX has denied having financial problems sending money to and from China.

Responses have been coming in from Chinese companies following queries from the ASX after Ding Sheng Xin Finance was suspended last week when it could not meet reporting deadlines to lodge its half-yearly accounts.

An ASX spokesman told The Australian yesterday that its recent query to almost 50 Chinese companies listed on the exchange was “prompted by information that one company was having difficulty repatriating funds and meeting its obligations as an ASX listed entity”.

“The ASX took the precautionary step of asking similar companies to disclose their status to test if the issues were specific or widespread,” he said.

He said the companies queried were those that had their principal business within China.

The spokesman said the initial responses to the queries appeared to indicate that “the funding concerns are specific to one company that is already suspended”.

“But we will continue to monitor (the situation),” he said.

Chinese companies responding to the ASX query in recent days include Boyuan Holdings, Dongfeng Modern Agricultural Group, China Magnesium, Premiere Eastern Energy, TTG, Traditional Therapy Clinics, Tianmei, Jiajiafu, Wonhe and Winha Commerce and Trade International.

The companies have generally replied that they have had no difficulty converting Chinese yuan into foreign currencies and that they are not aware of any changes to the laws in China that prohibit the conversion of yuan into foreign currencies.

While the regulations for taking money out of China have not changed, the Chinese government has been tightening the administration of the laws.

It has also been taking a stricter look at the nature of outbound investments by Chinese companies, particularly where they are seen to be for more speculative ventures.

The spokesman said the ASX’s action was designed to help ensure that the market was kept informed and that the companies could continue to meet their obligations as ASX-listed companies.

He said the ASX had taken similar country-of-origin or industry-wide action in the past.

In July this year it had queried listed resource companies about whether they had been impacted by changes to mining laws in Tanzania.

The spokesman said the ASX had not set a specific deadline for the replies but was expecting a response from all the companies queried within the next few days.

Ding Sheng Xin, whose Australian registry office is in Perth, is a company providing guarantees for small and medium enterprises and individuals in China.

Founded in 2005, it has 19 branches in four provinces in China and has provided about $1.6 billion in guarantees.

The company has been involved in a number of legal disputes in China. In a response to an ASX query in May, it said it was natural that it was involved in legal issues because of the nature of its business.

Payment of the company’s maiden 1c dividend, declared late last year, has been delayed.