China Merchants Bank (
China Merchants' share price rocketed to HK$10.68 on Friday -- 25 percent higher than the IPO price of HK$8.55. The bank, China's sixth-largest lender, raised US$2.4 billion in the second biggest IPO in Hong Kong this year.
"We're very satisfied," the bank's chairman, Qin Xiao (
"This shows how much the investors and the market approve of our business and have confidence in the future of our business. But the road is long. It doesn't mean much if a stock's price is good on one day," Qin added.
China Merchants was seen as a good buy because it has fewer non-performing loans than other big state-run banks and its also operated more like a for-profit business, analysts said.
"The rise in China Merchant's share price is because fund managers want to buy as much as possible, as it is considered the best-quality bank in mainland China," said Kenny Tang, associate director of Tung Tai Securities.
The listing came one day after Industrial & Commercial Bank of China (ICBC,
The bank planned to launch its US$19 billion IPO simultaneously in Hong Kong and Shanghai late next month.
Late on Friday night, ICBC posted its preliminary prospectus on the China Securities Regulatory Commission Web site. The IPO still needs regulatory approval.
The bank said it wanted to issue 13 billion A-shares, which are priced in Chinese currency. It also wanted to offer 35.39 billion H shares, or stocks for a mainland Chinese-registered company listed in Hong Kong.
The preliminary prospectus didn't provide guidance on pricing of the shares, but said that the A shares would be priced equal to H shares.
The IPO could be the world's largest since NTT Mobile Communications Network Inc, or NTT DoCoMo Inc, raised US$18.4 billion in 1998, according to market-data provider Dealogic Inc.
ICBC would be the third of China's big four state-owned banks to list in the last year.
The other two were the smaller Bank of China Ltd (中國銀行) and China Construction Bank Corp (中國建設銀行).
Both have fared well in Hong Kong as investors viewed them as ways to tap into China's fast-growing economy.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading
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