Sharp Decline of IPO Applications in A-Share Market Could End China's 'Dammed Lake' Dilemma
Dou Shicong
DATE:  Nov 27 2017
/ SOURCE:  Yicai
Sharp Decline of IPO Applications in A-Share Market Could End China's 'Dammed Lake' Dilemma Sharp Decline of IPO Applications in A-Share Market Could End China's 'Dammed Lake' Dilemma

(Yicai Global) Nov. 27 -- The number of companies looking to go public in China's A-share market has been on the decline recently, which may see the glut of firms currently in the midst of the application process gradually fall, said Xuan Changneng, assistant to the chairman of China Securities Regulatory Commission (CSRC).

More than 400 companies have listed on the A-share market since the beginning of this year, while the 'dammed lake' of firms looking to float has declined by more than 200, Securities Times reported today. The dammed lake is a term coined by China's investors and used to refer to a vast queue of companies looking to list in the A-share market but being held up by the application process.

The decline in companies filing for initial public offerings is mainly a result of more strict regulation over the issuing of new shares. China's new Issuance Examination Committee took office on Oct. 17 this year and had reviewed 52 companies by Nov. 20, approving 31, declining 16 and delaying its decision for the remainder to give a pass rate of less than 60 percent.

The new committee held an inauguration ceremony on Nov. 20, when Liu Shiyu, chairman of the CSRC, said that the regulator will implement a system of lifelong liability on the committee's members, holding them responsible for issues arising in companies even if they are no longer incumbent.

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Keywords:   IPO,A-Share Market,China Securities Regulatory Commission,Liu Shiyu,Issuance Examination Committee