Lufax Has Plenty Of Ground To Cover To Win Investors' Good Graces

Lufax Has Plenty Of Ground To Cover To Win Investors' Good Graces

Benzinga
July 23, 2025

The online loan facilitator has signed a flurry of agreements strengthening its ties to its parent, Ping An Group, as it works towards reinstatement of trading for its Hong Kong stock

Key Takeaways:

Lufax has hired Ernst & Young as its new auditor after firing PwC over disagreements about related-party transactions

At the same time, the online loan facilitator disclosed a series of new agreements involving its parent, Ping An, to support its business growth

Lufax Holding Ltd. (NYSE:LU) (6623.HK) has been embroiled in a scandal this year over questionable transactions with related parties, likely involving parent Ping An Group and the financial services giant's subsidiaries. Yet the online loan facilitator's financial dependence on its parent appears to be only deepening as it seeks to jumpstart its growth. That doesn't exactly help reduce the very risk that has led to the company's current predicament, which led to the suspension of trading for Lufax's Hong Kong-listed shares in January.

Lufax has been in hot water since late last year when a senior executive tipped off then-auditor PricewaterhouseCoopers (PwC) about potentially problematic related-party transactions that the company had made. PwC started expressing reservations, only to get sacked by Lufax early this year. The sudden absence of an auditor meant the company couldn't publish its annual report for 2024 on time, which led to the suspension of its Hong Kong-listed shares.

Lufax's Hong Kong shares remain suspended to this day. Last Thursday, the company provided its latest quarterly update on what it's doing to return to compliance so its Hong Kong stock can resume trading.

For starters, Lufax said it's still answering questions from the stock exchange about its situation, and, more importantly, that it has hired Ernst & Young (E&Y) and the auditing giant's Ernst & Young Hua Ming China affiliate as its new auditor. In that process, though more by coincidence than as a deliberate act, Lufax joined a long list of ...

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