The stock exchange has sent a letter to Chinese Estates Holdings demanding details of how it managed to lose $2.2 billion on the stock market last year - the largest trading loss by a locally listed company to date. Compounding the company's problems, global rating agency Standard & Poor's (S&P) described the investments as 'opportunistic' and placed its BBB-minus corporate credit rating on credit watch with negative implications, one stage ahead of a full downgrade. S&P said the loss significantly offset the company's gain of $3.26 billion from the sale of the Entertainment Building in Central last year. 'At a time of weak rentals, sale and property values in the Hong Kong market, the credit quality of property investors and developers like Chinese Estates can be sustained by conservative debt usage and financial policies,' it said. 'The securities trading losses, in addition to reducing the company's current cushion against further deterioration in the property market, reflect an opportunistic operating style and tolerance for taking equity-market risks,' the agency said. Chinese Estates executive director Thomas Lau Luen-hung said the stock exchange sent it a letter the day after the loss was announced asking for more details of how they were incurred. 'Whatever the stock exchange wants to know we will provide them with detailed information,' he said after one of the group's subsidiaries, Kwong Sang Hong International (KSHI), held its annual general meeting. Mr Lau is also an executive director of KSHI. 'It's nothing special,' he claimed. Chinese Estates shares yesterday closed at $2.10, down 17.5 cents, or 7.7 per cent, from Friday's close of $2.275. Mr Lau emphasised the loss did not occur overnight and said the company's investments had been profitable prior to the regional financial turmoil. 'The nose-dive in stock prices was totally unexpected,' he said. He declined to comment further on the contents of its portfolio, 80 per cent of which is understood to have been invested in HSBC Holdings. He said a comprehensive report would be published in this year's annual report. Mr Lau also emphasised chairman Joseph Lau Luen-hung's decision to reduce his personal stake in Chinese Estates was unrelated to the disappointing performance. Exchange spokesman Henry Law Man-wai said Chinese Estates' results announcement last week was unclear, adding the exchange wanted more details about its overall performance. Late last year, the stock exchange sent letters to all listed companies asking them to disclose any negative impact of the regional financial crisis on their performance. No disclosures were made at the time by Chinese Estates, although Mr Law said in the company's case there was no reason to expect one as companies do not have to reveal whether they have made a provision until results are announced. S&P spokesman Agnes Lee said it would ask Chinese Estates to provide more information about its cash levels and debts after taking into account the substantial loss in securities trading. 'We also have to study whether the company has changed its investment policy in view of its large exposure to securities trading,' she said.