Latest Search
Quote
| Back Zoom + Zoom - | ||||
|
<Capital>CCB/ BANK OF CHINA/ BANKCOMM/ PSBC Raise RMB500B+ from Premium A-shr Placement with CN MOF; Brokers Believe Deal Is Cost-effective, Conducive to Resilience of CN Banking System
Recommend 25 Positive 53 Negative 12 |
||||
|
||||
|
Four state-owned banks, including CCB (00939.HK), BANK OF CHINA (03988.HK), BANKCOMM (03328.HK) and PSBC (01658.HK), announced capital injection plans of China's Ministry of Finance (MOF) and other organizations. CCB proposed to issue 11.33 billion A-shares to the MOF (at a price of RMB9.27 per A-share) to raise up to RMB105 billion to replenish its CET1 capital, while BANK OF CHINA proposed to issue A-shares to the MOF (at an issue price of RMB6.05 per A-share) to raise up to RMB165 billion. BANKCOMM proposed to issue A-shares (at an initial issue price of RMB8.71 per share) to raise up to RMB120 billion to replenish its CET1 capital, while PSBC proposed to issue A-shares (at an issue price of RMB6.32 per share) to raise RMB130 billion to replenish CET1 capital. The A-share placement price per share represents a premium of 8.8-21.5% over the closing price of the underlying A-shares on last Friday. Of which, the premiums for BANKCOMM/ PSBC were 18.3%/ 21.5%, respectively. The valuation of the above placing prices is equivalent to 2024 average PB ratio of 0.73x, Morgan Stanley said. Regarding the dilutive effect of the capital injection of the MOF and others on the relevant Chinese banks, the broker believed that CCB has the lowest dilutive effect of 4.5%, involving a RMB105 billion capital injection, while BANK OF CHINA/ BANKCOMM/ PSBC are expected to have a dilutive effect of 9.3%/ 18.6%/ 20.7% each. It is expected that the capital injection will be completed in the middle of 2025, and should not affect 2024 dividend declaration. Moreover, HSBC Global Research believed that the capital injection will be beneficial to the resilience of China's banking system. AAStocks Financial News |
||||
Copied to Clipboard
 |
||||
