Breaking News, World News and Taiwan News.

Singapore's OCBC bank to raise US$2.7 bil. in rights issue

SINGAPORE--Singapore's Oversea-Chinese Banking Corp (OCBC) said Monday it plans to raise SG$3.37 billion (US$2.70 billion) in a rights issue to boost its balance sheet following its takeover of Hong Kong's Wing Hang Bank.

OCBC said in a statement it has received in-principle approval from the Singapore Exchange Securities Trading Ltd. for its plan to issue 440.05 million new ordinary shares priced at SG$7.65 each.

The offer is at a 25-percent discount to Friday's closing price of SG$10.20.

OCBC said the rights issue “will enable the company to balance its sheet and enhance the financial flexibility of the group” following its purchase of Wing Hang for US$5 billion.

The Singaporean lender, one of Southeast Asia's largest listed banks, in a statement last month said it owns 98 percent of Wing Hang.

OCBC said the takeover of Wing Hang will provide it with a platform to grow its yuan-denominated businesses.

Hong Kong is the world's biggest offshore market for the yuan, which is gaining international significance in tandem with China's growing economic might.

Paul Dowling, principal analyst at Sydney-based bank research firm East & Partners, said the number of shares of issued by OCBC “is about right,” easing existing shareholders' concerns about diluting stakes.

“The pricing is a pretty steep discount. It is obviously going to be very attractive to existing shareholders,” Dowling told AFP.

“I think the bank has really just pitched it at that price to get it away quickly,” he added.

OCBC on Aug. 5 reported that its net profit for the three months to June rose 54 percent from the same period a year ago to SG$921 million, its highest quarterly profit in nearly two years.

OCBC shares was trading at SG$10.14 by mid-afternoon on Monday, 0.59 percent lower from Friday's closing price.

Write a Comment
CAPTCHA Code Image
Type in image code
Change the code
 Receive China Post promos
 Respond to this email
WSJA
Subscribe  |   Advertise  |   RSS Feed  |   About Us  |   Career  |   Contact Us
Sitemap  |   Top Stories  |   Taiwan  |   China  |   Business  |   Asia  |   World  |   Sports  |   Life  |   Arts & Leisure  |   Health  |   Editorial  |   Commentary
Travel  |   Movies  |   TV Listings  |   Classifieds  |   Bookstore  |   Getting Around  |   Weather  |   Guide Post  |   Student Post  |   Terms of Use  |   Sitemap
  chinapost search