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Communications bank decides share numbers The Bank of Communications, China's fifth-largest lender, planned to simultaneously issue 5.856 billion H shares in Hong Kong and 3.912 billion A shares in Shanghai, the China Business News reported. Citing a prospectus that the paper obtained from an unnamed source close to the bank's senior management, the report said a green shoe option of up to 15 percent of the H shares would be granted to the main underwriters. HSBC Holdings, which took a 19.9 percent stake in the bank last year, and Goldman Sachs (Asia) LLC would act as global coordinators and co-bookrunners for the H-share offering, the report said. If the plan goes through, the Bank of Communications may become the first Chinese company to list shares simultaneously on the mainland and Hong Kong. The report contradicted other recent media reports that have said the bank will abandon or delay its Shanghai offer due to poor market conditions and problems with the wide gap between share prices on the two markets. The China Business News said that there would be a 15 percent share overallotment option in the Hong Kong portion of the initial public offering. The report said the Hong Kong offer would represent 12 percent of the bank's expanded share capital while the Shanghai portion would be equal to 8 percent. Of the 5.86 billion H shares, 1.94 billion shares will be sold to HSBC Holdings to allow the London-based financial group to maintain its 19.9 percent stake in the Bank of Communications, according to the report. The report also said the bank's core capital adequacy ratio was 6.77 percent at the end of 2004 and its 2005 net profit is expected to reach 7.87 billion yuan (US$950.89 million). |
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