[HONG KONG] Shares in Postal Savings Bank of China (PSBC) opened flat in their Hong Kong debut on Wednesday, after the state-owned lender raised US$7.4 billion in the world's biggest initial public offering in two years and priced the deal near the bottom of its marketing range.
The steady start for PSBC comes as investors remain cautious on the outlook for the Chinese banking industry, battling with mounting bad debts amid a slowing economy. The IPO received tepid demand, and three-fourths of the offer was pre-sold to cornerstone investors, mainly consisting of Chinese state-owned companies.
PSBC shares opened at HK$4.76, unchanged from the IPO price, while the benchmark Hang Seng index was poised to drop 0.5 per cent. The lender priced 12.1 billion new shares near the bottom of expectations, after marketing the offering between HK$4.68 and HK$5.18 per share.
Demand from retail investors - key for successful Hong Kong IPOs - was just 2.6 times more than the number of shares on offer, PSBC said in a filing on Tuesday, while the institutional tranche was heavily over-subscribed.