Hang Seng to sell stake in Industrial Bank for US$2.7b
[HONG KONG] Hang Seng Bank Ltd, the Hong Kong lender controlled by HSBC Holdings Plc, will sell a second stake in China's Industrial Bank Co for as much as US$2.7 billion to boost capital.
Hang Seng Bank plans to sell as many as 950.7 million of Industrial Bank shares at 17.68 yuan each, equivalent to about 16.8 billion yuan, the company said in a statement to the Hong Kong stock exchange on Tuesday. After the sale, Hang Seng Bank will only hold a 0.88 per cent stake in Industrial Bank.
Hang Seng Bank joins global banks including Bank of America Corp and Goldman Sachs Group Inc which have raised at least US$14 billion divesting shares in Chinese financial institutions since the start of 2012. Global regulators have toughened scrutiny on lenders since the financial crisis, making it more expensive to hold minority investments in banks.
The proceeds from the sale will be used to "support future business expansion" and the lender will "regularly review its remaining shareholding" in Industrial Bank, Hang Seng Bank said in the statement.
Shares of Industrial Bank, based in the southern Chinese city of Fuzhou, closed 0.6 per cent higher at 18.80 yuan before the announcement. The stock has climbed 71 per cent in the past six months, in line with a 76 per cent gain in the Shanghai Composite index.
BLOOMBERG
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Banking & Finance
Nomura, Mizuho face losses on All Blue fund’s failed trades
Stablecoin Tether steps up monitoring in bid to combat illicit finance
HSBC asked by US$890 billion investor group to set energy goal
Barclays is the latest firm to face anti-ESG wrath in Oklahoma
Barclays prices mortgage-backed notes in deal with GoldenTree
TD risks an earnings hit from US laundering probe, analysts say