Citic Securities chairman Wang Dongming fired the first salvo at the mainland regulator, saying the suspension of initial public offerings to support stock prices is wrong.
Speaking at a financial forum in Shanghai at the weekend, the head of the mainland's largest brokerage warned that the capital market was being 'marginalised' as the intervention hampered the growth of the securities sector.
'Using administrative forces to control the timing, rhythm, size and price of [share sales] while orchestrating rally and fall on the market is questionable,' Mr Wang said. 'In fact, the real situation has proved the measures wrong.'
The China Securities Regulatory Commission suspended listing approvals in September last year to avert the flow of fresh equity and boost the weak market.
The Shanghai Composite Index has jumped 54.99 per cent since November 4 last year when it hit a 26-month low.
Mainland banks extended new loans worth 5.17 trillion yuan (HK$5.87 trillion) in the first four months of this year. However, listed companies have raised only 20 billion yuan from share placements in the same period.
Mr Wang said 300 to 400 companies were keen to launch share sales to raise funds for expansion, but the suspension had deterred them from raising funds.