Overseas Chinese Banking Corporation (OCBC Bank)

guys any thoughts on buying wing hang bank instead? its now selling for 1.6x book value only
does it seems like an easy profit since OCBC will buy it for 2x book value?

(06-03-2014, 09:41 AM)ForeverAlone Wrote: guys any thoughts on buying wing hang bank instead? its now selling for 1.6x book value only
does it seems like an easy profit since OCBC will buy it for 2x book value?

For arbitrage deal, upside should always view together with downside. So what if the deal fall through? The 2x valuation is the market anticipation, will OCBC afford to pay? Will the deal be closed lower than 2x?

My take is the Wing Hang Bank doesn't not worth 1.6x, without the OCBC deal.

If the deal falls apart how much will wing hang fall to? 1 times book?

OCBC still Singapore's core engine to grow. Although housing loans are reducing, doesn't stop them from expanding overseas.

As long as we spend money everyday, OCBC will continue to earn.

HONG KONG — Shares in Wing Hang Bank, which is in the process of being taken over by Singapore’s Oversea-Chinese Banking Corp (OCBC), jumped yesterday after the Hong Kong lender reported stellar annual profit.

The shares rose 2 per cent to close at a session high of HK$109.60 each, after the second-largest family-run lender in Hong Kong announced a 21.3 per cent surge in earnings last year due to higher net interest income and one-off gains from the revaluation and disposal of assets.

Net profit was HK$2.1 billion (S$342 million), it said, while operating profit, which reflects the performance of the core business, rose 9.5 per cent to HK$1.9 billion.

“With the growing internationalisation of the yuan, interest rate differentials between Hong Kong and the mainland will give rise to ample opportunities for our onshore and offshore yuan businesses,” Wing Hang said.

OCBC and Wing Hang are in exclusive talks until the end of this month to finalise the terms of a sale that sources have said is worth about S$6.3 billion.

The deal would significantly increase OCBC’s exposure to Greater China, raising its Chinese loans to 25 per cent of its total from around 15 per cent, UBS analysts estimate. It would also give the bank a foothold in Macau, which generates around 15 per cent of Wing Hang’s pre-tax profit.

OCBC shares rose 1.2 per cent to close at S$9.54 in Singapore yesterday. AGENCIES

i think when the muddy water settles down, i will consider. By then everyone should be clearer why you want to buy or not to buy.

by end of march should see OCBC's detailed announcement on Wing Hang
but if OCBC rallies to $10 by then, u would had missed the boat

when it was selling at 9.10-9.20 it was really cheap for 11 times earnings, a solid well managed blue chip with good long term track record

however if they gonna pay too much of wing hang, everything falls apart. A well balanced approach is key.

Ha! Ha!
Of course, He who dares always win or die. It's life man. And investing in shares can often be like that for some people. i did but very rarely.

Also if u buying before the announcement, do note that there's a high possibility of rights issue to pay for Wing Hang, need deep pockets too. Also if your pocket is really deep if rights issue, can apply for excess to take advantage of others who are cash strapped.

(07-03-2014, 10:57 AM)felixleong Wrote: Also if u buying before the announcement, do note that there's a high possibility of rights issue to pay for Wing Hang, need deep pockets too. Also if your pocket is really deep if rights issue, can apply for excess to take advantage of others who are cash strapped.

hopefully there's no more extensions anymore..just don't like how it is dragged on and on...