(Yicai Global) July 19 -- Donghai Securities's Chairman Zhu Kemin has resigned after Jiangsu province's police department started its investigation into the chief of the Chinese firm that has been punished by the nation's securities regulator already three times this year for breaking different types of rules. 

Zhu is "assisting authorities with an investigation," the Changzhou-based company said in a statement yesterday, without disclosing more details about the case. The board named director Chen Yaoting as an interim chairman and said that the incident will not have a major impact on the company's operation.

Zhu joined Donghai in 2003, and served as chairman from May 2013. Since the beginning of this year, the China Securities Regulatory Commission has reprimanded Donghai due to insufficient compliance, default on bond underwriting and inadequate control of overseas subsidiaries. 

The incident may cause volatility for Donghai's financial performance, analysts told Yicai Global.

Donghai's net profit attributable to shareholders fell for the third year in a row last year. However, in the first half of this year, the firm's net profit suddenly surged 20 times to CNY306 million (USD44.5 million), according to its earnings report. During those six months, it generated an operating income of CNY743 million, up 64 percent from the same period of last year.

Editor: Emmi Laine