Chinese developer Jinmao searched by Hong Kong’s anti-graft agency

Chinese state-owned property developer China Jinmao Holdings said its Hong Kong office had been searched as part of an investigation into bribery.

And the company’s chief financial officer, Jiang Nan, was asked to visit the city’s Independent Commission Against Corruption (ICAC) after the anti-graft agency had carried out its search, Jinmao said in a statement late on Tuesday.

The probe was related to an alleged contravention of Section 9 of the Prevention of Bribery Ordinance, Jinmao said, stressing that neither the company nor any of its units “is a subject of the investigation”.

“The company was required to provide certain documents and records to assist the ICAC in its investigation,” the statement said.

Sebastian Cheng, Jinmao’s head of investor relations, declined to say if Jiang was still being probed.

Jinmao said in its statement that the investigation “has not had and is not expected to have any adverse effect on the business.”

However, its Hong Kong shares had fallen 2.3 per cent to HK$3.83 by noon on Wednesday, having dropped as much as 3 per cent earlier in the session.

JP Morgan downgraded the company to “neutral” from “overweight”, citing corporate risk as a major concern.

“It is impossible to draw a conclusion on what exactly happened,” JP Morgan analysts led by Ryan Li wrote in a note after the event.

Jinmao, the flagship real estate business of China’s Sinochem Group, is known for owning a group of luxury commercial and residential properties across the mainland, including the famous 88-storey Shanghai Jin Mao Tower, at one time the city’s tallest building.

Jiang Nan, 44, joined Sinochem Group’s finance department in 1995. He later became the chief financial officer of Jinmao’s predecessor Franshion Properties.

Coincidentally, He Binwu, a former Jinmao executive director, resigned yesterday from his post as chairman of another developer, SRE Group, based in Shanghai.