DBS gains regulatory approval to up stake in Shenzhen Rural Bank
DBS Group has obtained the requisite regulatory approvals to increase its stake in Shenzhen Rural Commercial Bank Corporation (SRCB) to 16.69 per cent from 13 per cent.
DBS said on Friday (Dec 29) that it will acquire Shenzhen Huaqiang Asset Management’s stake of 383.6 million SCRB shares for 5.25 yuan (S$0.98) per share.
This is equivalent to 1.05 times of the book value per share for the latest available quarter, with the total consideration of two billion yuan.
The bank had been in discussions with Shenzhen Huaqiang Asset Management to acquire its stake in SRCB since the first quarter of 2023, and entered into an agreement on Sep 15.
This agreement was subject to regulatory approval, and did not require DBS to commit any technology resources.
This transaction will have less than 0.1 percentage point impact to the consolidated capital ratios of DBS and its subsidiaries, and is expected to be earnings accretive immediately.
DBS acquired a 13 per cent stake in SRCB for S$1.08 billion in April 2021, making it the largest shareholder of the bank.
Shares of DBS closed up 1.1 per cent or S$0.37 to S$33.41 on Friday, before the news.
Copyright SPH Media. All rights reserved.
