Citic Pacific, the Hong Kong-listed arm of China International Trust and Investment Corp, said yesterday it had potential foreign exchange losses of about US$2bn.

“These contracts were done without proper authorisation, and the potential maximum exposure under these contracts was not evaluated correctly,” Larry Yung, Citic Pacific chairman, said yesterday. “I personally, and on behalf of the board, am very sorry that this has occurred.”

Mr Yung said Citic Pacific's group finance director, Leslie Chang, and group financial controller, Chau Chi-yin, had resigned over the losses, adding that “disciplinary action will be taken against other staff members associated with this event”. He said that “there was no reason to believe fraud or other illegal activities were involved”.