Bank of China to sell assets to Hong Kong unit for HK$6.9 billion

[HONG KONG] Bank of China Ltd will sell Malaysian and Thai assets to its Hong Kong subsidiary for HK$6.9 billion (S$1.19 billion) as the fourth-largest mainland lender restructures its businesses in Southeast Asia.

The company will sell Bank of China (Thai) Pcl for about HK$3.1 billion and Bank of China (Malaysia) Bhd for around HK$3.8 billion to BOC Hong Kong (Holdings) Ltd, according to announcements made Thursday to the city's stock exchange. The amount will be paid in cash in Hong Kong dollars.

"Southeast Asia is a key region for 'the belt and road initiative'," Yue Yi, BOC Hong Kong's chief executive officer, said in a separate press release, in reference to a China-led project to deepen economic ties across Asia.

By acquiring the assets from its parent, BOC Hong Kong "can transform from a local bank to a regional bank," he said.

The transactions were first flagged by the companies in May last year. In its own statement on Thursday, Bank of China said it will announce progress on the deals and potential restructuring in other Southeast Asian countries as required.

BLOOMBERG