- Title: CHINA: BANK OF CHINA SHARES LAUNCHED IN HONG KONG CEREMONY.
- Date: 25th July 2002
- Summary: HONG KONG, CHINA (JULY 25, 2002) (REUTERS - ACCESS ALL) 1. LV: LISTING CEREMONY ON TRADING FLOOR 0.05 2. GV/MV: VARIOUS LIU MINGKANG CHAIRMAN AND PRESIDENT OF BANK OF CHINA SPEAKING AT THE CEREMONY (3 SHOTS) 0.38 3. GV/MV: LIU MINGKANG TOASTING WITH OTHER OFFICIALS (2 SHOTS) 0.59 4. MV: BANKING ANALYST SIMON HO TALKING TO REPORTER 1.02 5. MCU: (SOUNDBITE) (English) SIMON HO REGIONAL BANKING ANALYST OF MACQUARIE EQUITIES (ASIA) LIMITED SAYING: "Clearly a very tough environment, the market conditions are horrendous as we can see. And obviously the external environment in Hong Kong is also very difficult. The banking conditions in Hong Kong are very weak. We are still suffering from deflation, high unemployment, weak confidence and hardly any loan demand in the city. So, I think it's a very tough time to launch an IPO.... I think I was little surprised, it was higher than my expectations. Clearly they had the liberty to price any where within the indicated price range. But my expectation, my assessment on the company shows somewhere lower in the range would be more reasonable.....I think it's very hard to guess what's going to happen on the first day of trading. Clearly I think given the poor market performance in past couple weeks, there will be a lot of people ready to sell their shares. But likewise, in these IPOs, there is a fair amount of support that is planned by the sponsors on the couple days of trading the stock. It's hard to gauge but clearly there is a lot of pressure on the downside at this point by the market." 2.51 6. GV: VARIOUS BANK OF CHINA PEOPLE AND OFFICIALS LOOKING AT STOCK PRICES (2 SHOTS) 3.02 7. MCU: (SOUNDBITE) (English) LIU MINGKANG CHAIRMAN AND PRESIDENT OF BANK OF CHINA SAYING: "What I said, I am confident with our performance in the long run, I am confident with the trust of our investors upon us. And we have 80 years plus here, and we have brand new strategy plus good tactic to managing this business, to deliver superior shareholder value, thank you." 3.31 8. LV: WIDE SHOT STOCKBROKERS ON TRADING FLOOR 3.38 9. MCU: CLOSE-UP STOCK PRICES ON SCREEN 3.48 10. GV/TV/PAN: VARIOUS STOCKBROKERS TRADING ON TRADING FLOOR (2 SHOTS) 4.14 Initials Script is copyright Reuters Limited. All rights reserved
- Embargoed: 9th August 2002 13:00
- Keywords:
- Location: HONG KONG, CHINA
- Country: China
- Reuters ID: LVA8JPPH1E9GATSKS6A958B9PA8J
- Story Text: Global markets might be at their lowest levels in
years, but that's not stopping a frenzy in Hong Kong over the
first ever Initial Public Offering by the Bank of China - the
worlds third largest IPO this year.
Despite the global downturn thousands of Hong Kong
residents lined up to apply for shares in the Bank of China,
whose central government ties make it a sure win in the eyes
of many Hong Kong investors.
The IPO, which will list about a quarter of the banks
shares on Hong Kongs stock exchange, is also being seen as a
test of how to gradually transform state run Chinese companies
into market savvy entities.
In an elaborate opening ceremony on the floor of the Hong
Kong stock exchange on Thursday (July 25) , Bank of China
officials cut a ribbon marking the start of trading.
"What I said, I am confident with our performance in the
long run, I am confident with the trust of our investors upon
us. And we have 80 years plus here, and we have brand new
strategy plus good tactic to managing this business, to
deliver superior shareholder value", said Bank of China
Chairman Liu Mingkang.
But euphoria over the share was clearly limited as they
opened at HK$7.90 early in the pre-, down from an initial
public offering price of HK$8.50 per share.
Many market sources had expected the stock to dip at best
in its first day of trade, saying the stock had been priced
too high given recent market volatility. But some thought Wall
Street's major gains overnight, the biggest since 1987, would
boost sentiment.
The bank is the jewel in the crown of mainland state giant
Bank of China, which has been wracked by a string of financial
scandals this year. Worth about US$2.8 billion, its initial
public offering is the world's third-largest this year.
With US$98 billion in assets, the bank is the city's
second-largest banking group after HSBC is one of three
issuers of Hong Kong bank notes.
But analysts and fund managers showed concerns about the
bank's high bad loan ratio, which was about 11 percent of its
total at the end of 2001, more than double the Hong Kong
industry average.
Retail investors, who were allocated roughly one-third of
the offering, received a five percent discount on their
shares, paying about HK$8.08 apiece.
The success of the listing will be closely watched by
Beijing. China's big state banks are technically insolvent by
western standards and are being pressed by the government to
reform ahead of their own eventual listings.
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