BOC seeks more shares in HK
By George Chen |
March 12, 2010, Friday
|
Print Edition
Print Edition
THE Bank of China, one of the country's big four state lenders, said it wants to issue more shares in Hong Kong soon, an offering that could strengthen its balance sheet by some US$7.7 billion.
Many of China's big banks are tapping debt and equity markets for funds after a lending spree last year to support government economic stimulus left their capital ratios under pressure and fanned worries about bad loans.
BOC, which is also listed in Shanghai, said the follow-on offer of Hong Kong-listed H-shares would be 20 percent of its H-share capital.
Based on yesterday's market price in Hong Kong, the planned new share offering could be worth about HK$60 billion (US$7.7 billion), making it the biggest fundraising plan in Hong Kong so far this year, according to Reuters calculations.
Hong Kong-listed companies usually offer a discount of 5-10 percent to the current share price when they issue new shares.
"We want to do it as soon as possible but we will also have to find a good time to make it happen," Xiao Gang, the chairman of BOC, told a media briefing in Beijing.
"The board has approved the plan and now we need to seek approval from our shareholders as well as the regulators in both Hong Kong and Beijing for our new share issuances," he said.
Analysts briefed by the bank in January had said BOC was studying a new share sale in Hong Kong to raise capital, supplementing plans for a convertible bond issue of up to 40 billion yuan (US$5.86 billion).
Many of China's big banks are tapping debt and equity markets for funds after a lending spree last year to support government economic stimulus left their capital ratios under pressure and fanned worries about bad loans.
BOC, which is also listed in Shanghai, said the follow-on offer of Hong Kong-listed H-shares would be 20 percent of its H-share capital.
Based on yesterday's market price in Hong Kong, the planned new share offering could be worth about HK$60 billion (US$7.7 billion), making it the biggest fundraising plan in Hong Kong so far this year, according to Reuters calculations.
Hong Kong-listed companies usually offer a discount of 5-10 percent to the current share price when they issue new shares.
"We want to do it as soon as possible but we will also have to find a good time to make it happen," Xiao Gang, the chairman of BOC, told a media briefing in Beijing.
"The board has approved the plan and now we need to seek approval from our shareholders as well as the regulators in both Hong Kong and Beijing for our new share issuances," he said.
Analysts briefed by the bank in January had said BOC was studying a new share sale in Hong Kong to raise capital, supplementing plans for a convertible bond issue of up to 40 billion yuan (US$5.86 billion).
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