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Chinese bank raises US$7.42B in IPO; BOJ charts new policy framework

S&P Global MarketIntelligence offers our top picks of banking news stories and more publishedthroughout the week. Please note that some entries may have links tothird-party sources that may require a subscription.

Big Chinese bank IPO, othershare sales

*Postal Savings Bank of China Co.Ltd., the fifth-largest Chinese lender by assets, HK$57.60 billion, orUS$7.42 billion, in its Hong Kong IPO, the biggest in value globally sinceAlibaba Group Holding Ltd.'s US$25 billion offering in September 2014.

*China's Bank of Hangzhou Co.Ltd. is seeking toraise about 3.77 billion yuan by selling 261,750,000 shares at14.39 yuan each in its Shanghai IPO. CICC is acting as underwriterof the proposed IPO.

*Meanwhile, Chongqing RuralCommercial Bank Co. Ltd. obtained regulatory approval for its proposed IPO inShanghai. Backin April, the bank said it was looking to issue up to 1,357,000,000 shares inthe proposed offering.

*Postal Savings Bank of China priced its IPO of 12.11 billion new shares at HK$4.76apiece. While the price is toward the bottom end of an initial indicative rangeof HK$4.68 to HK$5.18, it represents 0.95x estimated 2016 book value, a biggermultiple than current levels for any of the Hong Kong-traded stocks of the fourbiggest Chinese banks.

WhilePostal Savings Bank of China was able to clear the shares on offer at thatvaluation, largely thanks to backing from government-tied institutions, itsshares could be a hard sell in the secondary market as many investors may findits business unglamorous.

Monetary policy, regulatorydevelopments

*The Bank of Japan refrained from revising its interest rates and insteaddecided to modify its existingpolicy framework to target 10-year interest rates. The newframework consists of two major components: a "yield curve control"and a commitment to expanding the monetary base until the year-over-year rateof increase in the consumer price index exceeds 2%.

*Bank Indonesiacut its benchmarkinterest rate by 25 basis points to 5%. The central bank also lowered itsdeposit and lending facility rates by 25 basis points to 4.25% and 5.75%,respectively.

*The Reserve Bank of NewZealand left theofficial cash rate unchanged at 2% but signaled the possibility of furthereasing in the future to ensure that inflation remains within its target range.

*Similarly, the Bangko Sentral ng Pilipinas decided to maintain the interest rate on its overnightreverse repurchase facility at 3%.The correspondinginterest rates on the overnight lending and deposit facilities, as well as thereserve requirement ratios, were left unchanged.

*The Hong Kong MonetaryAuthority is releasing an enhanced competency framework rules on cybersecurity andmoney laundering.

*In more cybersecuritynews, the Reserve Bank of India ordered banks to immediately report all cyberattacksafter some lenders failed to report such breaches to avoid negative publicity.

*Indonesia's FinancialServices Authority, or OJK, asked the local affiliates of Singapore lenders tosupport the Southeast Asian country's tax amnesty program.

* InTaiwan, the Financial Supervisory Commission fined CTBCBank Co. Ltd. NT$3 million and barred it from engaging in trustbusiness of public tender offer business for three months.

*Meanwhile, the China Banking Regulatory Commission totaling 15.06 millionyuan on 44 financial institutions, including state-owned banks, in the thirdquarter.

M&A updates

* the acquisition of a 49% stakein Union KBC Asset Management Co. Pvt. Ltd. and Union KBC Trustee Co. Pvt. Ltd.The bank acquired the stake from KBC Participations Renta SA and KBC AssetManagement NV.

*Bank of the PhilippineIslands completed the acquisition of the remaining 60% stake inBPI Globe BanKO from Globe Telecom Inc. and Ayala Corp.

*will merge its units,Yuanta Commercial Bank Co.Ltd. and Ta ChongBank Ltd., through a share swap deal.

*General Electric Co. received interests from three private equity firms forits 43% stake in South Korea's Hyundai Card Co. Ltd. A sale of the stake may fetch morethan 600 billion South Korean won.

* obtained in-principle regulatory approval to merge withVinaconex-Viettel Finance JSC and to create a new consumer credit subsidiary.The State Bank of Vietnam approved the merger plan, which shareholders of the twocompanies approved in 2015.

In other news

*China's banks are showing some of the biggest signs of early warning indicatorsfor stress of any lenders in the world, with the ratio of credit to GDPexceeding long-term trends by 30.1%, the Bank for International Settlementssaid.

*settled a legal dispute with Pankaj and Radhika Oswalover the sale of the couple's Burrup Fertilisers business in 2010.

*Bank of China Ltd.'sBank of China - New YorkBranch was appointed as the first yuan clearing bank in the U.S.

* and signeda memorandum of understanding tocooperate in various areas, including won-yuan settlement.

*Officials of are set to facecharges from the Philippines' Anti-Money Laundering Council inconnection with the bank's involvement in the cybertheft of funds from BangladeshBank.

* in a U.S.-based fintechfirm involved in blockchain technology. The bank invested an undisclosed amountin San Francisco-based Ripple through its fintech unit, Digital Ventures.

*Sumitomo Mitsui Trust HoldingsInc. and Nagano BankLtd. will both conduct 1-for-10 reverse stock splits .

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UPDATE: Bankof Japan gives relief to lenders with new interest rate target