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China's Biggest Brokerage Citic In $166bn Error

China's Biggest Brokerage Citic In $166bn Error

Tuesday 24, 12 2019
China's biggest brokerage, Citic Securities, overstated its derivative business by $166bn (£110bn) from April to September, according to the country's securities association.

The Securities Association of China said the firm inaccurately inflated the amount of its equity swap transactions in a report submitted in October.

Citic said the error occurred due to a system upgrade and has been corrected.

Probes have resulted in executives confessing to insider trading at Citic.

In September, shares of China's largest state-owned brokerage slumped after it reported that three executives, including its president, were under police investigation.

The firm has been part of a crackdown by China's regulators on irregular stock trading since mainland markets plunged dramatically in mid-June.

Shares dip

The securities association, which is partly overseen by the China Securities Regulatory Commission, said it was investigating Citic's overstatement and would take further action if necessary.

It did add that the error did not affect the month-end net size of Citic's business.

The brokerage told the Reuters news agency that it had amended the figures at the start of November and the size of its swaps business was $6.2bn.

An equity swap is a type of derivative that refers to a cash exchange between realized gains on specific stocks and fixed interest rates over a certain period of time in the future.

Shares of Citic Securities fell 0.7% in Shanghai.

>>> Read more: Vietnam’s Textile Industry: Fail To Reach Target

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Financial News

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