China shares fall on weaker banks, Hong Kong lackluster
* HSI +0.1 pct, H-shares -0.4 pct, CSI300 -0.6 pct
* China financials down as PBOC says to strengthen regulation
* China Vanke H-shares dip below opening price in HK debut (Updates to midday)
By Grace Li
HONG KONG, June 25 (Reuters) - China shares fell in early trade on Wednesday, weighed down by underperforming financial institutions, while the benchmark index in Hong Kong eked out slim gains.
By midday, the Hang Seng Index inched 0.1 percent higher to 22,905.11 points. The China Enterprises Index of the top Chinese listings in Hong Kong fell 0.4 percent.
The CSI300 of the leading Shanghai and Shenzhen A-share listings slipped 0.6 percent. The Shanghai Composite Index was down 0.5 percent at 2,023.65 points, its lowest since May 22.
"The resumption of initial public offerings (IPOs) is still an important factor in diverting funds from the market, especially at the quarter-end when liquidity is not very sufficient," said Zhang Yanbin, analyst at Zheshang Securities in Shanghai.
"But the correction on the SSEC is going to be very limited. There should be a strong support at the 2,000-point level," Zhang added.
The new listings in the mainland have attracted huge demand after a four-month hiatus on offerings. The first six companies which have finished subscriptions locked up a combined 563.9 billion yuan ($90.82 billion), the China Securities Regulatory Commission said on its official microblog late on Tuesday.
Three will have their trading debut in Shenzhen on Thursday.
Chinese financials were among the biggest index drags during the session. Ping An Insurance Group Co of China shed 0.7 percent, as did Industrial Bank.
The country's biggest lender Industrial and Commercial Bank of China lost 1.5 percent to a three-month low, while the largest listed brokerage CITIC Securities was off 1 percent.
A deputy governor of the People's Bank of China (PBOC) said on Tuesday the central bank is working on rules regarding bankruptcy of financial institutions to strengthen regulation in the sector, mainland media reported.
News reports quoting a central bank official saying the cut in banks' reserve requirement ratios is expected to be assessed once a year, dashed some smaller banks' hopes of benefitting from a loosening in the near term.
China Vanke was down 3 percent from its HK$13.66 per share opening price on its trading debut in Hong Kong. The largest residential property developer in China converted its B-shares in Shenzhen into H-shares, listing in the offshore market by way of introduction without raising any new capital.
The company also said on Wednesday it was in talks with global investors, including funds and real estate peers, to sell a strategic stake as the company seeks to expand overseas and tap offshore capital markets.
Its Shenzhen A-share listing gained 0.3 percent at 8.11 yuan.
The Hang Seng was mainly lifted by a few heavyweight stocks. Tencent Holdings and China Mobile each added 0.6 percent.
($1 = 6.2090 Chinese yuan) (Reporting by Grace Li; Editing by Jacqueline Wong)