Singapore’s OCBC Bank raising $2.7b to fund China expansion

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OCBC bankSingapore banking giant Oversea-Chinese Banking Corporation, or OCBC, plans to raise $2.7 billion in fresh equity to help fund its push into China, Singapore’s second-largest bank announced on August 18, undershooting expectations for the amount it had been expected to raise.

The rights issue, which is being offered at a 25 per cent discount to the closing price on August 8, will help pay for the bank’s $5 billion purchase of Wing Hang, a Hong-Kong-based bank with a presence in southern China.

OCBC intends to use the deal to boost its existing presence in the mainland and establish a platform for better capturing the growing trade flows between China and its southeast Asia home.

The deal is Singapore’s second-largest ever rights issue, according to market researcher Dealogic. Analysts had speculated that OCBC, traditionally a bank with one of the strongest capital bases, might tap investors for more to further boost its cushion.

OCBC is one of a handful Asian banks with a claim to being a regional champion. From its Singapore base it has expanded into Malaysia and Indonesia with interests also in Thailand and Vietnam. The purchase of Wing Hang Bank by ASEAN’s second-largest lender is its most ambitious to date.

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Reading Time: 1 minute

Singapore banking giant Oversea-Chinese Banking Corporation, or OCBC, plans to raise $2.7 billion in fresh equity to help fund its push into China, Singapore’s second-largest bank announced on August 18, undershooting expectations for the amount it had been expected to raise.

Reading Time: 1 minute

OCBC bankSingapore banking giant Oversea-Chinese Banking Corporation, or OCBC, plans to raise $2.7 billion in fresh equity to help fund its push into China, Singapore’s second-largest bank announced on August 18, undershooting expectations for the amount it had been expected to raise.

The rights issue, which is being offered at a 25 per cent discount to the closing price on August 8, will help pay for the bank’s $5 billion purchase of Wing Hang, a Hong-Kong-based bank with a presence in southern China.

OCBC intends to use the deal to boost its existing presence in the mainland and establish a platform for better capturing the growing trade flows between China and its southeast Asia home.

The deal is Singapore’s second-largest ever rights issue, according to market researcher Dealogic. Analysts had speculated that OCBC, traditionally a bank with one of the strongest capital bases, might tap investors for more to further boost its cushion.

OCBC is one of a handful Asian banks with a claim to being a regional champion. From its Singapore base it has expanded into Malaysia and Indonesia with interests also in Thailand and Vietnam. The purchase of Wing Hang Bank by ASEAN’s second-largest lender is its most ambitious to date.

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