China may resume IPO approvals in July

China's stock regulator could resume approving new stock offers as early as July after an eight-month suspension, state media said Wednesday. The China Securities Regulatory Commission (CSRC) suspended approvals for initial public offerings (IPO) in November to prevent an oversupply of shares and boost the weak stock market. But Yao Gang, vice-chairman of the commission, hinted at a possible resumption at an industry meeting on Tuesday in Beijing, the Securities Times said, quoting unnamed sources. "What will you do if it resumes on July 30?" Yao reportedly asked representatives of brokerages and investment banks present at the meeting. Another state-backed paper, the China Securities Journal, also quoted an industry source as saying the resumption could occur in July at the earliest. The reports hit already jittery mainland shares on Wednesday, with the benchmark Shanghai composite index ending the day 0.73 percent lower owing to investor fears of an oversupply of shares. "It's not an appropriate time to resume approvals for companies to list on the main board, which has been sluggish for a while," said an analyst at a Shanghai-based brokerage, who declined to be named. "There is insufficient liquidity in the market, which will not be able to digest the IPOs even if companies get approved," he said. The CSRC declined to comment on the reports. Companies that had already passed preliminary hearings for listing would likely be among the first to get the go-ahead for their IPOs if they meet requirements, the China Securities Journal said. The regulator earlier this month issued draft rules, which are open for public comment until Friday, aimed at reforming the current listing mechanism and boosting investor protection.