Overseas Chinese Banking Corporation (OCBC Bank)

[specuvestor]

^^ cause they have bad acquisition record since LKY "encouraged" a second wing

Heng indo regulator say no to DBS else it just adds to the record of bad timing

Wonder if that's why Conner left. Better to keep his excellent reputation intact. One of the few good FT we got

[cfa]

The present CEO is a Shanghainese whose root is from HK. He should know HK better than many.

[Temperament]

The present CEO is a Shanghainese whose root is from HK. He should know HK better than many.

It maybe better or it maybe worse. "KAKI LUNG PAK SI BOH SIANG KANG" applies both ways.

[freedom]

If I didn't recall wrongly GE pays its policyholders 7/8 of all profits (could be wrong if tested by an accountant), not sure if it includes special dividends; shareholders get 1/8 only...

That's nothing wrong. GE manages the funds(maybe has a small contribution) mainly and charges fees. The unit holders of participated fund should receive most of the profit from the underlying performance.

[CityFarmer]

OCBC is acting fast to capture the China opportunities...

OCBC launches US$100 million China private equity fund

INGAPORE--OCBC has launched a US$100 million private equity fund in China under the Shanghai Qualified Foreign Limited Partner (QFLP) programme, stepping up its ability to invest in the country’s booming private sector.

With this move, OCBC became the first bank in Southeast Asia to have a QFLP license, which allows it to directly convert foreign capital into Renminbi and invest in domestic Chinese companies.

Offshore entities without the QFLP license have to go through a complex approval process to convert foreign currency for onshore investments in China, said Mr Than Su Ee, head of OCBC’s investment arm, Mezzanine Capital Unit (MCU).
...
http://www.todayonline.com/business/ocbc...quity-fund

[mulyc]

It is a very good foundation for ocbc's expansion into china.

[mulyc]

OCBC Said in Talks for All-Debt Financing for Wing Hang Deal
By Zijing Wu and Joyce Koh - Jan 13, 2014
Oversea-Chinese Banking Corp. (OCBC) is in talks with lenders including Bank of America Corp. and HSBC Holdings Plc about an all-debt financing for its acquisition of Hong Kong’s Wing Hang Bank Ltd. (302), according to two people with knowledge of the matter.
Singapore-based OCBC plans to sell stock later to help repay the short-term loan, said the people, who asked not to be identified because the discussions are private. Talks between the companies are centering around a valuation of almost 1.9 times Wing Hang’s book value, though no terms have been finalized, one person said.
At that valuation, OCBC would pay almost HK$39 billion ($5 billion) for Wing Hang based on the Hong Kong family lender’s book value as of June 30, data compiled by Bloomberg show. OCBC said Jan. 6 it was in exclusive talks with Wing Hang’s biggest shareholders to buy the bank in what would be its largest acquisition, surpassing the $2.8 billion OCBC paid in 2001 for Keppel Capital Holdings Ltd.
Wing Hang shares fell 2.1 percent as of 1:26 p.m. in Hong Kong, the steepest decline in a month, giving it a price-to-book multiple of 1.72. OCBC trades at 1.52 times after advancing 0.2 percent in Singapore today.
Spokesmen at Bank of America, HSBC, Wing Hang and OCBC declined to comment on the financing details.
Price Concerns
OCBC, which gets about two-thirds of its revenue from Singapore, is stepping up overseas expansion plans as it seeks to offset the thinnest lending margins in Southeast Asia. The Singaporean lender has 16 branches in China, one in Taiwan and one in Hong Kong, Chief Financial Officer Darren Tan said last week. Wing Hang has 70 branches in Hong Kong, Macau and mainland China.
The family of Wing Hang Chairman Patrick Fung, its affiliates and Bank of New York Mellon Corp. together hold about 45 percent of shares in the Hong Kong lender.
OCBC shares on Jan. 9 fell to the lowest in almost a year on concern it would overpay for Wing Hang. Larger Singaporean competitor DBS Group Holdings Ltd. in 2001 bought Hong Kong’s Dao Heng Bank Ltd. for $5.4 billion, an acquisition that cost it at least S$2.1 billion ($1.7 billion) in writedowns. DBS paid 3.3 times book value for Dao Heng.
UBS analysts Stephen Andrews and Khairul Rifaie in a note dated Jan. 6 estimated that a Wing Hang acquisition carried out at 1.75 times book value would dilute OCBC earnings by about 5 percent and require a “sizeable capital raising.”
Singapore boasts some of the world’s strongest banks, based on their equity capital ratios. OCBC had a common equity Tier 1 capital ratio of 14.3 percent as of Sept. 30, more than triple the minimum regulatory environment. It finished the third quarter with S$14.5 billion of cash and equivalents, data compiled by Bloomberg show.
To contact the reporters on this story: Zijing Wu in Hong Kong at zwu17@bloomberg.net; Joyce Koh in Singapore at jkoh38@bloomberg.net
To contact the editor responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net
®2014 BLOOMBERG L.P. ALL RIGHTS RESERVED.

[felixleong]

SINGAPORE — Oversea-Chinese Banking Corporation (OCBC) has agreed to raise its stake in Bank of Ningbo to 20 per cent from 15.34 per cent for about S$383 million, the latest step in a drive to extend its footprint in China.

The transaction will be funded through OCBC’s internal resources and is subject to regulatory approvals in China, as well as by other Bank of Ningbo shareholders, OCBC said in a statement today (Jan 14).

The deal is expected to be completed sometime in the third quarter of 2014. It comes just a week after OCBC said it was in exclusive talks to buy Hong Kong’s Wing Hang Bank in a deal that could be worth over S$6.3 billion.

OCBC has been in a partnership with Bank of Ningbo since 2006. It said China’s growing importance in terms of trade and the increasing internationalisation of its currency offers OCBC good prospects for developing its business. REUTERS

[arriyana]

Anyone got a good analysis of OCBC stock as of recent?

[Admin's note : No need to manually add the link, you can make the link available via the Website and Signature fields. Check out the details at User CP.]

[DP28]

Credit lending / shadow banking has always been a persistent problem in China. It seems like big sam is betting that the PBOC will do its best to avert a crisis like 07. Compared to historical acquisition, their bid may seem not overly priced. But in today's context, you dont know whether you are getting yourself into a lemon deal or not. Just Go big or go home.

Rated underperform by CS. Seem like more downside pressure selling into the acquisition.