OCBC to raise stake in Ningbo bank
OCBC Bank, South-east Asia's second-largest lender, will spend about 1.8 billion yuan (S$380 million) buying new shares in Bank of Ningbo to help its Chinese affiliate boost capital.
OCBC will increase its stake in the Shenzhen Stock Exchange-listed bank to 20 per cent - from 15.34 per cent - as part of a private placement, the Singapore-based lender said in a statement to the stock exchange yesterday.
The share subscription, expected to be completed in the third quarter, comes as OCBC looks to increase its footprint in China to tap growing regional trade flows and increasing use of the yuan as an international currency.
OCBC is in exclusive talks through Jan 31 with the largest shareholders of Wing Hang Bank to buy the Hong Kong-based bank, in what would be its largest acquisition.
"Banking with Chinese companies, onshore and offshore, and developing the ability to tap into the fast-growing offshore yuan market will remain a key focus for us," OCBC chief financial officer Darren Tan said in an e-mailed statement yesterday.
Bank of Ningbo plans to raise 3.2 billion yuan from the private placement to its two largest shareholders - OCBC and Ningbo Development & Investment Group - to bolster capital, the Zhejiang-based lender said in a statement.
OCBC will buy no more than 207.5 million shares and Ningbo Development will subscribe to 158.5 million shares at 8.85 yuan each, Bank of Ningbo said.