Goldman Sachs Investment Advisory closes Korean unit
28 August 2015
Maeil Business Newspaper
Goldman Sachs Investment Advisory has withdrawn its business from the Korean market amid criminal investigations into allegations of stock price manipulation. According to sources Thursday, Goldman Sachs Investment Advisory shut down its Korean business as of August 21. Regulatory approval to the business withdrawal was granted, which was posted on the Financial Services Commission website. Continue reading
Troubled Hanergy Thin Film Power announces massive layoffs and losses
PUBLISHED : Saturday, 29 August, 2015, 2:30am
Jing Yang and Langi Chang
Embattled solar panel maker Hanergy Thin Film Power Group unveiled a sweeping restructuring plan late on Friday that will eliminate over a third of its workforce, while reporting its first half-year deficit in six years. Continue reading
“Then we come to the question of related party transactions. In the Companies Act, only if you are directly related to that particular transaction, you are debarred from voting, but other promoters can vote. In a firm, a certain product was purchased from a private company belonging to the the wife of the promoter, and she held 2% of the share in that company. So only she was debarred. Under Sebi rules, that cannot happen. In our case, we have said that irrespective of whether you are party to that transaction, we are going by the concept of whether you are a related party or not.”
‘Every market misconduct, dubbed scam, has taken capital market back by 10 yrs’
23 August 2015
Journal of Banking & Finance Volume 60, November 2015, Pages 181–194
Short interest and stock price crash risk
Jeffrey L. Callena, , Xiaohua Fangb, ,
- We find evidence that short interest is positively related to future crash risk.
- The evidence is in line with the view that short sellers detect bad news hoarding.
- Additional findings show that the relation is more salient for specific subsamples.
- Empirical support is provided for the main relation observed above.
Using a large sample of U.S. public firms, we find robust evidence that short interest is positively related to one-year ahead stock price crash risk. The evidence is consistent with the view that short sellers are able to detect bad news hoarding by managers. Additional findings show that the positive relation between short interest and future crash risk is more salient for firms with weak governance mechanisms, excessive risk-taking behavior, and high information asymmetry between managers and shareholders. Empirical support is provided showing that the relation between short interest and crash risk is driven by bad news hoarding.
Why do auditors disclaim?
Aug 19, 2015, 8:46 AM
Last week Tianhe Chemicals (Tianhe), a Chinese company listed in Hong Kong,announced that its auditor, Deloitte, was planning to disclaim an opinion on its financial statements. Tianhe was the target of an activist short seller campaign by Anonymous Analytics last September and a damaging analysis by theAssociated Press in November. Also last week Sihuan Pharmaceuticals (Sihuan) published its annual report for 2014 including a disclaimer opinion on its financial statements by auditor PwC. PwC used seven pages to explain why it was unable to express an opinion on the financial statements. Both stocks remainsuspended.
Disclaimer opinions are rare, so two in one week is notable. These opinions are rare because they are useless to companies and investors, so companies generally will not accept them. Regulators and exchanges are unlikely to accept a disclaimer opinion, which explains why these stocks are suspended and are likely to remain so. Continue reading
MSCI Removes Hanergy From Indexes; Move allows funds to dispose of millions of dollars they have locked up in Hanergy shares
MSCI is the latest of four major index compilers to remove Hanergy. PHOTO: REUTERS
WAYNE MA And JACKY WONG
Aug. 27, 2015 7:16 a.m. ET
HONG KONG—Stock-index compiler MSCI Inc. ejected a troubled Hong Kong solar-power company from its indexes, enabling some of the world’s biggest investment managers to dispose of hundreds of millions of dollars they have locked up in the firm’s shares. Continue reading