Bank of China (
Shares were valued at HK$2.95 each (US$0.38), and they closed at HK$3.40, defying jitters that dragged down the market's benchmark Hang Seng Index by 1.3 percent.
About HK$20.06 billion worth of shares changed hands.
Demand for the stock has been strong among institutional investors, who haven't been scared away by the bank's history of corruption and bad debt.
The bank's ratio of nonperforming loans to total lending was reported at a whopping 33 percent in 2003. After a government bailout, the bank said the number fell to 4.4 percent.
However, much of its lending has been to companies, and an economic slowdown could cause the bad loans to balloon again.
Corruption has been another worry. Former bank chairman, Wang Xuebing (王雪冰), is serving a prison term for taking bribes. A former president of the bank's Hong Kong branch, Liu Jinbao (劉金寶), was given a suspended death sentence last year for embezzlement.
Two former branch managers and their family members are facing trial in Las Vegas, Nevada, for alleged embezzlement and money laundering.
Steven Cheung (張仁良), a professor of finance at City University of Hong Kong, said the past problems aren't spooking investors because they think the stock gives them a chance to buy into China's hot economic growth.
Cheung added that investors think that since the bank is among the first to list overseas, it must have sorted out its accounting books and is "brave enough to face the international investment community." The bank also has the crucial support of China's central government, which has launched a campaign to clean up the financial system, he said.
"Bank of China is too big to fail," the professor said.
Another factor inspiring investors is the success other Chinese banks have had with IPOs in the past year in Hong Kong. The share price for China Construction Bank (中國建設銀行), the nation's No. 4 lender, has shot up nearly 50 percent since its IPO in late October.
The parade of big Chinese bank IPOs is expected to continue when Industrial and Commercial Bank of China (中國工商銀行), the country's No. 1 lender, hits Hong Kong's market later this year.
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
STATE OF THE NATION: The legislature should invite the president to deliver an address every year, the TPP said, adding that Lai should also have to answer legislators’ questions The Chinese Nationalist Party (KMT) yesterday proposed inviting president-elect William Lai (賴清德) to make a historic first state of the nation address at the legislature following his inauguration on May 20. Lai is expected to face many domestic and international challenges, and should clarify his intended policies with the public’s representatives, KMT caucus secretary-general Hung Meng-kai (洪孟楷) said when making the proposal at a meeting of the legislature’s Procedure Committee. The committee voted to add the item to the agenda for Friday, along with another similar proposal put forward by the Taiwan People’s Party (TPP). The invitation is in line with Article 15-2