FT.com / Lex / Financial services & property – UBS/Bank of China


UBS has scored a first in – or rather, out of – China. The Swiss bank, in the dying embers of 2008, sold its 1.3 per cent stake in Bank of China. It netted a few hundred million dollars in the process. Other banks, including Royal Bank of Scotland and Bank of America, could rake in substantially more by selling their shares in Chinese lenders. Because both are recipients of state cash striving to bolster balance sheets, gains in excess of $1bn plus would presumably come in handy.

The logic for selling now, as lock-up periods expire, is compelling. In all, foreign banks spent about $9bn accumulating stakes during the privatisation of China’s big three lenders three years ago. Although the Hong Kong-listed shares have fallen sharply from their 2007 peaks, strategic investors are still comfortably in the money. Shares in Bank of China, which are below the initial public offering price, would still yield a gain of about $1.3bn for RBS based on Wednesday’s close.

via FT.com / Lex / Financial services & property – UBS/Bank of China.

zyakaira notes: i do hope these investments are not being sold in a hurry. For example many such investments in india are among the precious few profit-making ventures left with these global institutions. If these are also sold then the business model is unlikely to be able to recover!

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About zyakaira

Investment Banker, 40s, Bangalore This Biopic and this web recreates how one point of view, one person can impact a tremendous economic engine that the world thrives and mis-thrives on. This one has the knowledge and the civil sense , the art of conversation and some good writing to mentor others as powerful and help global managers develop and fine tune their approach on US markets, China, India and the world. Read on here, and let me know what you need. It can be a race for TRPs, a race for new markets and a race to do what is right. I have the pulse of the crisis, the recovery and the market direction and can help you build and refine your strategy as i have helped thousands of managers and multiple global corporations. Of course, it’s more fun if you talk to me. I am in favor of leading this moving of the economic crisis and will partner with you in a soft and subtle way, just the way we both ride to the top. But you can write with us, opine and just reply with aplomb and shine on Twitter , 4 square , Facebook and any other social “choupal” of choice via zyaadakairaada Profile & Portfolio - SocialPicks Different flavours at: http://benchilibowl.wordpress.com http://zyaada.mp

Posted on January 5, 2009, in Bank Stocks, Financial Markets, Global, India, Investments, US and tagged , , , , , , . Bookmark the permalink. Leave a comment.

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