LONDON, Oct 30 (Reuters) - Europe's biggest bank HSBC Holdings (HSBA.L: Quote, Profile , Research) has sold its Marbles and Beneficial branded credit cards in Britain to specialist lender SAV Credit Ltd. for 385 million pounds ($796 million).
HSBC said on Tuesday the portfolios consist of 338,000 accounts and were not a core part of its strategy to grow its card business. The bank is one of Britain's biggest four card issuers, with over 10 million cards in issue using brands including HSBC and first direct.
HSBC acquired Marbles as part of its purchase of U.S. lender Household in 2003. Marbles closed to new credit card customers in April.
SAV was founded in 2001 as a provider of credit cards to consumers unable to get cards among mainstream lenders. It has opened more than 150,000 credit card accounts.
The Marbles deal will be funded by a new debt facility from Royal Bank of Scotland (RBS.L: Quote, Profile , Research) and by its existing private equity partners, including Palamon Capital, Electra Private Equity and Morgan Stanley Alternative Investment Partners.
Tuesday, October 30, 2007
Saturday, October 27, 2007
Bank of China not in talks with StanChart: sources
LONDON (Reuters) - Bank of China (BOC) (3988.HK: Quote, Profile, Research), the world's sixth-biggest bank by market capitalization, is not in talks with UK-based lender Standard Chartered Plc (STAN.L: Quote, Profile, Research), banking sources said on Friday.
Shares in Standard Chartered (STAN.L: Quote, Profile, Research), which derives over 90 percent of its profits from Asia, Africa and the Middle East, hit a record high on Friday on market talk that the Chinese lender was making an offer for the UK bank.
"They are not in talks," said a banker close to BOC, China's second biggest lender.
Wang Zhaowen, BOC's general manager and spokesman, also said he had not heard of any potential investment in Standard Chartered.
"I have not heard anything about that," Wang told Reuters.
Standard Chartered shares ended 4.5 percent higher on Friday at 1,799.11 each.
That values Standard Chartered at 2.43 times 2008 book value, similar to BOC's forward price-to-book valuation of 2.48 times, according to Reuters Estimates.
Analysts said Singapore state investment arm Temasek Holdings (TEM.UL: Quote, Profile, Research), Standard Chartered's single biggest shareholder, could have been buying shares in the London-based bank.
"Temasek has been buying StanChart shares in the past few months. They are sitting in a perfect position, and consider Standard Chartered a good investment," a source familiar with the situation said.
According to Reuters data, Temasek holds 17.22 percent stake in Standard Chartered as of September 13. Temasek spokeswoman Myrna Thomas confirmed on Sep. 4 that the company increased its holding in Standard Chartered to 16 percent from 15 percent on August 29.
Chinese financial firms have been increasingly active in making overseas deals.
Industrial and Commercial Bank of China (ICBC) (1398.HK: Quote, Profile, Research)(601398.SS: Quote, Profile, Research), the world's top bank by market capitalization, on Thursday, agreed to pay $5.56 billion for a 20 percent stake in South Africa's Standard Bank (SBKJ.J: Quote, Profile, Research), the biggest overseas acquisition by a Chinese bank.
On Monday, CITIC Securities Co.(600030.SS: Quote, Profile, Research), China's top broker, also agreed to swap stakes with Wall Street firm Bear Stearns (BSC.N: Quote, Profile, Research), with the Beijing-based firm paying $1 billion for bonds that will convert to about 6 percent of Bear Stearns shares.
Including China Development Bank's $3.14 billion investment in Barclays Bank (BARC.L: Quote, Profile, Research) and China's state investment agency's $3 billion buy in Blackstone Group (BX.N: Quote, Profile, Research), China has made about $12 billion worth of investments in overseas financial assets this year.
Shares in Standard Chartered (STAN.L: Quote, Profile, Research), which derives over 90 percent of its profits from Asia, Africa and the Middle East, hit a record high on Friday on market talk that the Chinese lender was making an offer for the UK bank.
"They are not in talks," said a banker close to BOC, China's second biggest lender.
Wang Zhaowen, BOC's general manager and spokesman, also said he had not heard of any potential investment in Standard Chartered.
"I have not heard anything about that," Wang told Reuters.
Standard Chartered shares ended 4.5 percent higher on Friday at 1,799.11 each.
That values Standard Chartered at 2.43 times 2008 book value, similar to BOC's forward price-to-book valuation of 2.48 times, according to Reuters Estimates.
Analysts said Singapore state investment arm Temasek Holdings (TEM.UL: Quote, Profile, Research), Standard Chartered's single biggest shareholder, could have been buying shares in the London-based bank.
"Temasek has been buying StanChart shares in the past few months. They are sitting in a perfect position, and consider Standard Chartered a good investment," a source familiar with the situation said.
According to Reuters data, Temasek holds 17.22 percent stake in Standard Chartered as of September 13. Temasek spokeswoman Myrna Thomas confirmed on Sep. 4 that the company increased its holding in Standard Chartered to 16 percent from 15 percent on August 29.
Chinese financial firms have been increasingly active in making overseas deals.
Industrial and Commercial Bank of China (ICBC) (1398.HK: Quote, Profile, Research)(601398.SS: Quote, Profile, Research), the world's top bank by market capitalization, on Thursday, agreed to pay $5.56 billion for a 20 percent stake in South Africa's Standard Bank (SBKJ.J: Quote, Profile, Research), the biggest overseas acquisition by a Chinese bank.
On Monday, CITIC Securities Co.(600030.SS: Quote, Profile, Research), China's top broker, also agreed to swap stakes with Wall Street firm Bear Stearns (BSC.N: Quote, Profile, Research), with the Beijing-based firm paying $1 billion for bonds that will convert to about 6 percent of Bear Stearns shares.
Including China Development Bank's $3.14 billion investment in Barclays Bank (BARC.L: Quote, Profile, Research) and China's state investment agency's $3 billion buy in Blackstone Group (BX.N: Quote, Profile, Research), China has made about $12 billion worth of investments in overseas financial assets this year.
Friday, October 26, 2007
金 管 局 再 沽 出 7.75 億 港 元
金 管 局 再 次 沽 出 7.75 億 港 元 ， 令 下 周 二 銀 行 體 系 戶 口 結 餘 增 加 至 28.52 億 港 元 ， 是 今 個 星 期 內 第 二 次 沽 出 港 元 。
金 管 局 發 言 人 表 示 ， 今 次 是 05 年 推 出 三 項 優 化 聯 匯 措 施 以 來 ，首 次 在 港 匯 處 於 7.75 強 方 保 證 上 限 買 美 元 ， 沽 港 元 。 而 本 周 早 段 沽 出 港 元 ， 就 是 在 強 弱 兌 換 保 證 範 圍 內 進 行 。
金 管 局 入 市 後 ， 港 匯 最 新 報 7.7506 元 ， 港 元 隔 夜 拆 息 報 4.6% ， 一 至 三 個 月 期 拆 息 介 乎 4.63% 至 4.75% 之 間 。
金 管 局 發 言 人 表 示 ， 今 次 是 05 年 推 出 三 項 優 化 聯 匯 措 施 以 來 ，首 次 在 港 匯 處 於 7.75 強 方 保 證 上 限 買 美 元 ， 沽 港 元 。 而 本 周 早 段 沽 出 港 元 ， 就 是 在 強 弱 兌 換 保 證 範 圍 內 進 行 。
金 管 局 入 市 後 ， 港 匯 最 新 報 7.7506 元 ， 港 元 隔 夜 拆 息 報 4.6% ， 一 至 三 個 月 期 拆 息 介 乎 4.63% 至 4.75% 之 間 。
Increasing Oil Reserves
An annual British Petroleum report claims that the world has enough oil reserves to last 40 more years. The study, based on officially submitted figures, show 15% more proven oil reserves globally than a decade ago. In fact, only North America has less known oil now than it had 20 years ago. Governments often rely on the BP reports, but many scientists questions whether the world really has that long to go before its fuel gauge hits empty.
Source: TIME digest October 2007 No. 140
Source: TIME digest October 2007 No. 140
Wednesday, October 24, 2007
PetroChina May Raise $8.9 Billion in Shanghai IPO
Oct. 24 (Bloomberg) -- PetroChina Co., the nation's biggest oil producer, may raise as much as 66.8 billion yuan ($8.9 billion) selling shares in Shanghai to expand refineries and output at oilfields, the company said in a stock exchange filing.
The company will sell shares at the price range of 15 yuan to 16.7 yuan each, according to the statement to the Hong Kong stock exchange. PetroChina said in a Oct. 21 share sale document that it will sell as many as 4 billion yuan-denominated shares in its Shanghai listing.
Surging energy demand has pushed PetroChina's share price up more than 15-fold since its Hong Kong listing in 2000, making the Beijing-based company the world's second largest by market value. The Shanghai sale gives investors in mainland China, home to the best-performing equity market this year, their first opportunity to buy the stock directly.
PetroChina slipped 0.21 percent in Hong Kong trading to HK$19.40 before the announcement. The stock has gained 76 percent this year, more than the 47 percent increase in the benchmark Hang Seng Index. The stock is set to start trading in Shanghai Nov. 5, PetroChina said Oct. 21.
If priced at the top end, the sale would surpass the 66.6 billion yuan generated by China Shenhua Energy Co. earlier this month and making it the world's largest stock offer this year.
The oil producer said Sept. 20 it plans to use 37.77 billion yuan of the funds raised in the Shanghai share sale for refinery and oilfield projects. The company will spend 17.5 billion yuan upgrading the Dushanzi refinery in the northwestern region of Xinjiang, it said.
Expansion Plans
PetroChina will spend 12.8 billion yuan to boost production capacity at its Changqing and Daqing fields, it said in its listing prospectus. The Beijing-based explorer and refiner will use 1.5 billion yuan to develop part of the Jidong Nanpu field, China's biggest oil discovery in almost 50 years, and 6 billion yuan to expand an ethylene plant at Daqing.
Oil and gas output increased by 5.6 percent in the third quarter at PetroChina, outpacing growth at Royal Dutch Shell Plc and Chevron Corp.
Total spending may jump 24 percent to $24.5 billion this year, PetroChina said in March. That is higher than Exxon Mobil Corp. and Europe's two largest oil companies, Shell and BP Plc.
Billionaire investor Warren Buffett's Berkshire Hathaway Inc. sold its entire stake in PetroChina, Buffett said in an interview on Fox Business Network Oct. 18. Berkshire was PetroChina's biggest shareholder after state-owned China National Petroleum Corp., holding more than 2.3 billion PetroChina shares as of the end of last year.
Berkshire bought its stake for less than HK$1.70 a share in April 2003. Activists have urged Buffett and other investors to divest PetroChina holdings over links to Sudan, whose government the U.S. accuses of supporting genocide. The decision to sell was ``100 percent'' based on share price, Buffett said.
UBS AG's China venture, UBS Securities Co., Citic Securities Co. and China International Capital Corp. are arranging the share sale.
The company will sell shares at the price range of 15 yuan to 16.7 yuan each, according to the statement to the Hong Kong stock exchange. PetroChina said in a Oct. 21 share sale document that it will sell as many as 4 billion yuan-denominated shares in its Shanghai listing.
Surging energy demand has pushed PetroChina's share price up more than 15-fold since its Hong Kong listing in 2000, making the Beijing-based company the world's second largest by market value. The Shanghai sale gives investors in mainland China, home to the best-performing equity market this year, their first opportunity to buy the stock directly.
PetroChina slipped 0.21 percent in Hong Kong trading to HK$19.40 before the announcement. The stock has gained 76 percent this year, more than the 47 percent increase in the benchmark Hang Seng Index. The stock is set to start trading in Shanghai Nov. 5, PetroChina said Oct. 21.
If priced at the top end, the sale would surpass the 66.6 billion yuan generated by China Shenhua Energy Co. earlier this month and making it the world's largest stock offer this year.
The oil producer said Sept. 20 it plans to use 37.77 billion yuan of the funds raised in the Shanghai share sale for refinery and oilfield projects. The company will spend 17.5 billion yuan upgrading the Dushanzi refinery in the northwestern region of Xinjiang, it said.
Expansion Plans
PetroChina will spend 12.8 billion yuan to boost production capacity at its Changqing and Daqing fields, it said in its listing prospectus. The Beijing-based explorer and refiner will use 1.5 billion yuan to develop part of the Jidong Nanpu field, China's biggest oil discovery in almost 50 years, and 6 billion yuan to expand an ethylene plant at Daqing.
Oil and gas output increased by 5.6 percent in the third quarter at PetroChina, outpacing growth at Royal Dutch Shell Plc and Chevron Corp.
Total spending may jump 24 percent to $24.5 billion this year, PetroChina said in March. That is higher than Exxon Mobil Corp. and Europe's two largest oil companies, Shell and BP Plc.
Billionaire investor Warren Buffett's Berkshire Hathaway Inc. sold its entire stake in PetroChina, Buffett said in an interview on Fox Business Network Oct. 18. Berkshire was PetroChina's biggest shareholder after state-owned China National Petroleum Corp., holding more than 2.3 billion PetroChina shares as of the end of last year.
Berkshire bought its stake for less than HK$1.70 a share in April 2003. Activists have urged Buffett and other investors to divest PetroChina holdings over links to Sudan, whose government the U.S. accuses of supporting genocide. The decision to sell was ``100 percent'' based on share price, Buffett said.
UBS AG's China venture, UBS Securities Co., Citic Securities Co. and China International Capital Corp. are arranging the share sale.
Tuesday, October 23, 2007
金 管 局 沽 出 7.75 億 港 元 是 自 有 強 弱 兌 換 保 證 以 來 第 二 次
2007-10-23 HKT 15:44
金 管 局 下 午 在 港 元 匯 市 進 行 干 預 ， 拋 售 了 總 值 7.75 億 港 元 ， 約 為 1 億 美 元 ， 以 壓 抑 港 元 的 強 勢 。 金 管 局 發 言 人 證 實 了 今 次 消 息 。
干 預 後 ， 港 元 兌 美 元 回 軟 到 7.7511 兌 1 美 元 ， 今 早 一 度 觸 及 7.75 兌 1 美 元 的 強 方 兌 換 保 證 水 平 ， 是 金 管 局 於 2005 年 5 月 推 出 三 項 優 化 匯 率 措 施 後 ， 首 次 觸 及 所 訂 立 的 強 方 兌 換 保 證 水 平 ， 主 要 是 受 到 資 金 持 續 流 入 所 推 動 。
在 現 有 匯 率 體 制 下 ， 如 果 即 期 匯 率 達 到 7.75 港 元 ， 香 港 金 融 管 理 局 承 諾 向 許 可 的 銀 行 賣 出 港 元 並 買 入 美 元 ， 並 將 資 金 注 回 銀 行 系 統 。
金 管 局 下 午 在 港 元 匯 市 進 行 干 預 ， 拋 售 了 總 值 7.75 億 港 元 ， 約 為 1 億 美 元 ， 以 壓 抑 港 元 的 強 勢 。 金 管 局 發 言 人 證 實 了 今 次 消 息 。
干 預 後 ， 港 元 兌 美 元 回 軟 到 7.7511 兌 1 美 元 ， 今 早 一 度 觸 及 7.75 兌 1 美 元 的 強 方 兌 換 保 證 水 平 ， 是 金 管 局 於 2005 年 5 月 推 出 三 項 優 化 匯 率 措 施 後 ， 首 次 觸 及 所 訂 立 的 強 方 兌 換 保 證 水 平 ， 主 要 是 受 到 資 金 持 續 流 入 所 推 動 。
在 現 有 匯 率 體 制 下 ， 如 果 即 期 匯 率 達 到 7.75 港 元 ， 香 港 金 融 管 理 局 承 諾 向 許 可 的 銀 行 賣 出 港 元 並 買 入 美 元 ， 並 將 資 金 注 回 銀 行 系 統 。
Monday, October 22, 2007
PetroChina Shanghai Shares to Start Trading on Nov. 5
Oct. 21 (Bloomberg) -- PetroChina Co., the nation's biggest oil producer, said it expects its yuan-denominated shares to start trading in Shanghai on Nov. 5.
The company, which is selling as many as 4 billion new shares, will start book building tomorrow, Beijing-based PetroChina said in a statement to the Shanghai stock exchange today. Investors can start applying for shares from Oct. 25 and a final price will be announced on Oct. 30, it said.
PetroChina's shares have gained 16-fold since its initial public offering in Hong Kong in 2000, making it the world's second-largest company by market value. The Shanghai sale gives investors in China, home to the best-performing equity market this year, their first opportunity to buy the stock directly.
The company said Sept. 20 it plans to raise 37.8 billion yuan ($5 billion) in the sale, based on the amount it plans to spend on refinery and oilfield projects. PetroChina will invest 17.5 billion yuan upgrading the Dushanzi refinery in the northwestern region of Xinjiang, it said.
Institutional investors can apply for shares from Oct. 25 and individuals can subscribe from Oct. 26, the company said.
PetroChina's shares rose 1.2 percent on Oct. 18 to close at a record HK$18.92, giving the company a market value of $437 billion. That ranks it between Exxon Mobil Corp.'s $511 billion and General Electric Co.'s $410 billion.
The company, which is selling as many as 4 billion new shares, will start book building tomorrow, Beijing-based PetroChina said in a statement to the Shanghai stock exchange today. Investors can start applying for shares from Oct. 25 and a final price will be announced on Oct. 30, it said.
PetroChina's shares have gained 16-fold since its initial public offering in Hong Kong in 2000, making it the world's second-largest company by market value. The Shanghai sale gives investors in China, home to the best-performing equity market this year, their first opportunity to buy the stock directly.
The company said Sept. 20 it plans to raise 37.8 billion yuan ($5 billion) in the sale, based on the amount it plans to spend on refinery and oilfield projects. PetroChina will invest 17.5 billion yuan upgrading the Dushanzi refinery in the northwestern region of Xinjiang, it said.
Institutional investors can apply for shares from Oct. 25 and individuals can subscribe from Oct. 26, the company said.
PetroChina's shares rose 1.2 percent on Oct. 18 to close at a record HK$18.92, giving the company a market value of $437 billion. That ranks it between Exxon Mobil Corp.'s $511 billion and General Electric Co.'s $410 billion.
Friday, October 19, 2007
HSBC activist investor wins some backing
LONDON (Reuters) - U.S. activist investor Knight Vinke has won some support for its call for change at HSBC Holdings, with a major fund manager and private shareholder lobby group saying the issues should be addressed.
New Star Asset Management, which owns just under 300 million pounds of shares, or about 0.3 percent, of Europe's biggest bank, said it supported the discussion about how HSBC (HSBA.L: Quote, Profile , Research) can revive its underperforming share price.
The UK Shareholders' Association (UKSA), a private shareholder lobby group, also said it supported Knight Vinke's concerns and urged HSBC to respond publicly.
Knight Vinke this week stepped up its attack on HSBC and said it should consider "radical solutions" such as a merger or completely exiting investment banking.
"We support the criticism about the poor share price performance of the last few years and are open to consider anything that could improve the share price performance," said Guy de Blonay, fund manager at New Star.
New Star has recently met Knight Vinke and HSBC's management, including Chief Executive Michael Geoghegan. De Blonay welcomed the increased focus on strategy, but said the fund manager had not yet decided whether to support Knight Vinke's campaign.
"As a result of this debate, shareholders should expect an improving news flow that should support the share price going forward," he said.
UKSA said it had studied Knight Vinke's report and said HSBC has "some legitimate questions to answer" about performance and strategy. It was unable to say how many HSBC shares its members held.
Major HSBC shareholders have been reluctant to comment on the proposals, but several have said HSBC has already shifted strategy and is addressing its underperformance.
HSBC has rejected the calls from Knight Vinke, saying it is already increasing its focus on Asia and other emerging markets.
Knight Vinke is backed by California state pension fund CalPERS and has also won support from the California State Teachers' Retirement System (CalSTRS), which owns HSBC shares worth $268 million (180 million pounds).
New Star Asset Management, which owns just under 300 million pounds of shares, or about 0.3 percent, of Europe's biggest bank, said it supported the discussion about how HSBC (HSBA.L: Quote, Profile , Research) can revive its underperforming share price.
The UK Shareholders' Association (UKSA), a private shareholder lobby group, also said it supported Knight Vinke's concerns and urged HSBC to respond publicly.
Knight Vinke this week stepped up its attack on HSBC and said it should consider "radical solutions" such as a merger or completely exiting investment banking.
"We support the criticism about the poor share price performance of the last few years and are open to consider anything that could improve the share price performance," said Guy de Blonay, fund manager at New Star.
New Star has recently met Knight Vinke and HSBC's management, including Chief Executive Michael Geoghegan. De Blonay welcomed the increased focus on strategy, but said the fund manager had not yet decided whether to support Knight Vinke's campaign.
"As a result of this debate, shareholders should expect an improving news flow that should support the share price going forward," he said.
UKSA said it had studied Knight Vinke's report and said HSBC has "some legitimate questions to answer" about performance and strategy. It was unable to say how many HSBC shares its members held.
Major HSBC shareholders have been reluctant to comment on the proposals, but several have said HSBC has already shifted strategy and is addressing its underperformance.
HSBC has rejected the calls from Knight Vinke, saying it is already increasing its focus on Asia and other emerging markets.
Knight Vinke is backed by California state pension fund CalPERS and has also won support from the California State Teachers' Retirement System (CalSTRS), which owns HSBC shares worth $268 million (180 million pounds).
HSBC cut to neutral at UBS
LONDON (MarketWatch) -- UBS downgraded banking giant HSBC (UK:HSBA) (NYSE:HBC) to neutral from buy, citing valuation as well as a likely slowdown in European growth in 2008 and a tough environment for its U.S. lending arm, Household. "The third-quarter of 2007 is set to look bad for Household, and we do not expect the group to make any effort at providing reassurance as to the near-term outlook," UBS said. It noted, on the other hand, that HSBC's Asian business is delivering its best growth in a decade.
Buffett says has sold entire PetroChina stake
NEW YORK (Reuters) - Warren Buffett said on Thursday his Berkshire Hathaway Inc (BRKa.N: Quote, Profile, Research) (BRKb.N: Quote, Profile, Research) insurance and investment company has sold its entire stake in PetroChina Co Ltd (0857.HK: Quote, Profile, Research), whose parent has been criticized for ties to Sudan.
In an interview on Fox Business Network, Buffett said, "we sold based on price," adding that "it was 100 percent a decision based on valuation."
He also said he probably sold too soon because shares of PetroChina have risen since the sales began.
Berkshire once owned more than 11 percent of the Chinese oil company's publicly floated shares.
The shares were worth $3.31 billion at the end of 2006, well above the $488 million that Berkshire paid for them, according to Berkshire's latest annual report. Berkshire's selling first surfaced in July.
Critics have said PetroChina, through its government-owned parent China National Petroleum Corp, is too closely linked to Sudan. The Sudanese government has been blamed for what the White House has called genocide in the Darfur region.
Shareholders at Omaha, Nebraska-based Berkshire's annual meeting in May overwhelmingly defeated a proposal calling on Berkshire to divest its PetroChina stake.
Buffett had opposed the proposal, though he said conditions in Darfur were deplorable and that he sympathized with people who wanted to change them. He said selling would not improve conditions in Sudan, and that Berkshire should not divest automatically because it disagrees with a particular activity.
Separately, Buffett denied rumors that Berkshire might buy a stake in Bear Stearns Cos (BSC.N: Quote, Profile, Research). The investment bank has this year suffered the collapse of two hedge funds and asset write-downs, helping push its shares down 27 percent.
An article last month in the New York Times said investors including Buffett may buy part of Bear Stearns. This month, Bear Stearns Chief Executive James Cayne said he would consider selling a stake to an investor from China or the Middle East.
In Thursday's interview, Buffett said he has not bought shares of mortgage lender Countrywide Financial Corp (CFC.N: Quote, Profile, Research) or luxury homebuilder Hovnanian Enterprises Inc (HOV.N: Quote, Profile, Research), shares of which are down 61 percent and 70 percent respectively this year.
He identified the Brazilian real as the currency Berkshire owned in May, when Buffett told shareholders he had a stake in one "surprise" currency.
Berkshire Class A shares closed down $995 at $129,000 on Thursday. The company's market value is about $199 billion.
In an interview on Fox Business Network, Buffett said, "we sold based on price," adding that "it was 100 percent a decision based on valuation."
He also said he probably sold too soon because shares of PetroChina have risen since the sales began.
Berkshire once owned more than 11 percent of the Chinese oil company's publicly floated shares.
The shares were worth $3.31 billion at the end of 2006, well above the $488 million that Berkshire paid for them, according to Berkshire's latest annual report. Berkshire's selling first surfaced in July.
Critics have said PetroChina, through its government-owned parent China National Petroleum Corp, is too closely linked to Sudan. The Sudanese government has been blamed for what the White House has called genocide in the Darfur region.
Shareholders at Omaha, Nebraska-based Berkshire's annual meeting in May overwhelmingly defeated a proposal calling on Berkshire to divest its PetroChina stake.
Buffett had opposed the proposal, though he said conditions in Darfur were deplorable and that he sympathized with people who wanted to change them. He said selling would not improve conditions in Sudan, and that Berkshire should not divest automatically because it disagrees with a particular activity.
Separately, Buffett denied rumors that Berkshire might buy a stake in Bear Stearns Cos (BSC.N: Quote, Profile, Research). The investment bank has this year suffered the collapse of two hedge funds and asset write-downs, helping push its shares down 27 percent.
An article last month in the New York Times said investors including Buffett may buy part of Bear Stearns. This month, Bear Stearns Chief Executive James Cayne said he would consider selling a stake to an investor from China or the Middle East.
In Thursday's interview, Buffett said he has not bought shares of mortgage lender Countrywide Financial Corp (CFC.N: Quote, Profile, Research) or luxury homebuilder Hovnanian Enterprises Inc (HOV.N: Quote, Profile, Research), shares of which are down 61 percent and 70 percent respectively this year.
He identified the Brazilian real as the currency Berkshire owned in May, when Buffett told shareholders he had a stake in one "surprise" currency.
Berkshire Class A shares closed down $995 at $129,000 on Thursday. The company's market value is about $199 billion.
China's BoCom says HSBC to raise stake in 12 mths
SHANGHAI/BEIJING, Oct 18 (Reuters) - HSBC Holdings Plc <0005.HK> wants to increase its stake in China's Bank of Communications <601328.SS><3328.HK> over the next 12 months, BoCom Chairman Jiang Chaoliang said on Thursday.
Jiang added that HSBC, which now holds an 18.6 percent stake in his bank -- China's fifth-largest in terms of assets -- would not be deterred by BoCom's rising share price.
"HSBC has the right to increase its stake and I believe it will definitely increase its stake," Jiang told a group of reporters during the Communist Party Congress in Beijing.
"I think you won't be asking me this question by this time next year," he said when asked about the timing of an increase.
In 2005, HSBC bought a 19.9 percent stake in BoCom for $1.75 billion, which was diluted to 18.6 percent early this year when the Chinese bank floated shares in the Shanghai market. It was already listed in Hong Kong.
"No matter from technical, supervision or legal perspectives, I don't see any obstacle for HSBC to increase its stake in BoCom currently," he said.
Following Jiang's comments, HSBC said in an e-mailed statement to Reuters: "HSBC continues its discussions with BoCom regarding restoring its shareholding to 19.90 percent."
"We have no further details to announce for the time being," it added.
Based on the HK$11.72 closing price of BoCom's Hong Kong-listed shares on Thursday, HSBC would need to pay about HK$7.46 billion ($962 million) for the 636.9 million shares needed to restore its stake to 19.9 percent.
20 PERCENT OR 40 PERCENT?
When HSBC bought 19.9 percent of BoCom in 2005, the Shanghai-based bank agreed that HSBC would have the option to raise its stake to 40 percent between 2008 and 2012, subject to the Chinese government's approval.
Currently, a single foreign investor can only own up to 20 percent of a Chinese bank, while overseas investors combined can hold no more than 25 percent of a domestic lender.
Foreign banks have been lobbying Beijing to increase the investment cap or scrap it altogether.
Citigroup Inc sought special permission from the Chinese government to purchase about 50 percent of Guangdong Development Bank in southern China last year, but it was eventually allowed only a 20 percent stake.
"It's unlikely that Beijing will lift or increase the investment cap for all foreign banks in China in the short term, but it's still hopeful for an individual foreign bank to seek special permission," said a foreign banker in China. Jiang did not elaborate on Thursday whether HSBC would increase its stake to 19.9 percent or 40 percent in the next 12 months, but he said the share price would not be a concern.
"Price should not have a big impact (on the deal) ... even if our H-share price reaches HK$30 to 40 apiece," he said.
A source close to BoCom told Reuters that the Chinese bank had set up a special team to work out a plan to allow HSBC to increase its stake eventually to 40 percent.
Jiang said BoCom was interested in expanding outside of China, with an overseas focus on the United States, Europe and the Asia-Pacific region, but he also mentioned India, South Africa and Brazil as possible destinations.
On Wednesday, media reports quoted Jiang as saying he expected the bank to post a 63.1 percent rise in profit this year, topping 20 billion yuan ($2.66 billion), but the bank later issued a statement saying the figure was only a target.
In response to Jiang's comments on its 2007 earnings, Goldman Sachs reiterated a "buy" rating on BoCom in a report to clients dated Oct. 18.
Jiang added that HSBC, which now holds an 18.6 percent stake in his bank -- China's fifth-largest in terms of assets -- would not be deterred by BoCom's rising share price.
"HSBC has the right to increase its stake and I believe it will definitely increase its stake," Jiang told a group of reporters during the Communist Party Congress in Beijing.
"I think you won't be asking me this question by this time next year," he said when asked about the timing of an increase.
In 2005, HSBC bought a 19.9 percent stake in BoCom for $1.75 billion, which was diluted to 18.6 percent early this year when the Chinese bank floated shares in the Shanghai market. It was already listed in Hong Kong.
"No matter from technical, supervision or legal perspectives, I don't see any obstacle for HSBC to increase its stake in BoCom currently," he said.
Following Jiang's comments, HSBC said in an e-mailed statement to Reuters: "HSBC continues its discussions with BoCom regarding restoring its shareholding to 19.90 percent."
"We have no further details to announce for the time being," it added.
Based on the HK$11.72 closing price of BoCom's Hong Kong-listed shares on Thursday, HSBC would need to pay about HK$7.46 billion ($962 million) for the 636.9 million shares needed to restore its stake to 19.9 percent.
20 PERCENT OR 40 PERCENT?
When HSBC bought 19.9 percent of BoCom in 2005, the Shanghai-based bank agreed that HSBC would have the option to raise its stake to 40 percent between 2008 and 2012, subject to the Chinese government's approval.
Currently, a single foreign investor can only own up to 20 percent of a Chinese bank, while overseas investors combined can hold no more than 25 percent of a domestic lender.
Foreign banks have been lobbying Beijing to increase the investment cap or scrap it altogether.
Citigroup Inc
"It's unlikely that Beijing will lift or increase the investment cap for all foreign banks in China in the short term, but it's still hopeful for an individual foreign bank to seek special permission," said a foreign banker in China. Jiang did not elaborate on Thursday whether HSBC would increase its stake to 19.9 percent or 40 percent in the next 12 months, but he said the share price would not be a concern.
"Price should not have a big impact (on the deal) ... even if our H-share price reaches HK$30 to 40 apiece," he said.
A source close to BoCom told Reuters that the Chinese bank had set up a special team to work out a plan to allow HSBC to increase its stake eventually to 40 percent.
Jiang said BoCom was interested in expanding outside of China, with an overseas focus on the United States, Europe and the Asia-Pacific region, but he also mentioned India, South Africa and Brazil as possible destinations.
On Wednesday, media reports quoted Jiang as saying he expected the bank to post a 63.1 percent rise in profit this year, topping 20 billion yuan ($2.66 billion), but the bank later issued a statement saying the figure was only a target.
In response to Jiang's comments on its 2007 earnings, Goldman Sachs
Thursday, October 18, 2007
China Stocks Drop on Arbitrage Comments; Hong Kong Shares Gain
Oct. 18 (Bloomberg) -- China's benchmark stock index fell the most in five weeks on speculation the securities regulator will adopt a plan that may narrow the price gap between shares traded simultaneously in Shanghai and Hong Kong.
China Securities Regulatory Commission Vice Chairman Tu Guangshao said yesterday that China is studying a plan to allow arbitrage between the two markets. Tu ``misspoke,'' Liu Fuhua, a spokesman for the regulator, said today after markets closed, declining to confirm whether such a plan is being considered.
Limits on inward and outward investment helped China's CSI 300 Index almost triple this year, outpacing a 91 percent gain in Hong Kong's Hang Seng China Enterprises Index, which measures 43 so-called H shares of Chinese companies.
Tu's comments ``had a negative impact on the local market and stocks with higher premium over their Hong Kong shares were dumped,'' said Wang Zheng, who manages the equivalent of $500 million at the asset management unit of Everbright Securities Co. in Shanghai.
Bank of Communications Co. and Aluminum Corp. of China Ltd.'s A shares paced the declines in China, with the CSI 300 Index sliding the most since Sept. 11. The two companies' H shares rose in Hong Kong, where the Hang Seng Index breached 30,000 for the first time.
The CSI 300, which tracks yuan-denominated A shares listed on China's two exchanges, slid 3.6 percent to 5,615.75 at the 3 p.m. close in Shanghai. The Hang Seng gained 0.6 percent to 29,465.05. It earlier touched 30,025.07. The H-share index added 1 percent to 19,722.38, after climbing as much as 5 percent.
Narrowing The Gap
The CSI 300 has jumped 175 percent this year, the most among 90 key stock indexes tracked by Bloomberg, valuing it at an average 54 times reported earnings. That's more than the 31 times for the Hang Seng China, which has gained 91 percent in 2007.
Tu's comments in Beijing raised expectations there will be measures installed to help narrow that gap. The regulator will announce the result of its study ``soon,'' Tu said.
C.K. Chan, a spokesman for the city's Securities and Futures Commission, declined to comment on such a plan today, as did Wong Hing-fung, a spokesman for the Hong Kong Monetary Authority, the city's de facto central bank.
Bank of Communications, China's fourth-largest lender by market value, fell 3.6 percent to 14.82 yuan in Shanghai. It climbed 7.1 percent to HK$11.72 in Hong Kong. Aluminum Corp.'s Shanghai shares slumped 6.2 percent to 50.72 yuan. The Hong Kong stock gained 2.9 percent to HK$24.80. The company, known as Chalco, is China's biggest aluminum producer.
Free Float
``It is reasonable to expect a much bigger impact on the A shares prices than a positive impact on H share prices,'' Vincent Chan, an analyst at Credit Suisse Group analyst wrote in a report today.
The percentage of free-float listed A shares is much smaller than for H shares, he wrote. If the two types of shares became fungible, large amounts of H shares would be swapped into A shares.
Chinese companies list in Hong Kong to lure international investors prohibited from buying shares on mainland exchanges. The market value of so-called H shares and red chips accounted for 53 percent of the total for the Hong Kong stock exchange's main board at the end of September, up from 26 percent at the end of 2002, according to the bourse's Web site. In 1997, when the U.K. handed Hong Kong back to China, they accounted for 16 percent.
China Eastern Airlines Corp., the country's third-largest carrier, slid 8.4 percent to 16.35 yuan in Shanghai. It added 2 percent to HK$8.01 in Hong Kong. Jiangxi Copper Co.'s A shares slid 6 percent to 65.95 yuan. The company, China's second-biggest copper producer, rose 4.1 percent to HK$30.75 in Hong Kong.
Years To Develop
Allowing arbitrage is ``clearly positive for H shares and Hong Kong in general,'' said Howard Wang, who oversees $30 billion as JF Asset Management Ltd.'s head of Greater China. Wang isn't changing his holdings just yet because the plan may take years to develop, the Hong Kong-based fund manager said.
Optimism for the plan to proceed may recede ``as people understand the further implications of this,'' Wang said.
The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, fell 3.5 percent to 5,825.28. The Shenzhen Composite Index dropped 2.5 percent to 1,494.59.
Tu's comments come on top of speculation mainland individuals will be allowed to invest directly in Hong Kong's equities. That expectation has helped fuel a two-month rally in the Hang Seng Index, driving the benchmark up 45 percent.
`Bite The Bullet'
``People don't know what to believe anymore but also don't want to miss out,'' said Brooke Babington, a trader at Helmsman Global Trading Ltd. in Hong Kong. ``They've got to bite the bullet.''
Analyst ``buy'' ratings on Hong Kong stocks jumped to 65 percent of recommendations last month, the highest percentage since January 2001, according to data compiled by Bloomberg. The last time they were as bullish was 2001 as the Internet bubble burst, and October 1997, when Asian currencies plummeted.
PetroChina Co., China's largest oil producer, gained 1.2 percent to HK$18.92. A 72 percent gain in its shares this year helped PetroChina to this week overtake General Electric Co. as the world's second-largest company by market value. Chairman Jiang Jiemin said on Oct. 15 that the company may debut in Shanghai next month.
Among Hong Kong-traded companies without a mainland listing, Cnooc Ltd., China's largest offshore oil producer, added 0.7 percent to HK$14.38.
China Securities Regulatory Commission Vice Chairman Tu Guangshao said yesterday that China is studying a plan to allow arbitrage between the two markets. Tu ``misspoke,'' Liu Fuhua, a spokesman for the regulator, said today after markets closed, declining to confirm whether such a plan is being considered.
Limits on inward and outward investment helped China's CSI 300 Index almost triple this year, outpacing a 91 percent gain in Hong Kong's Hang Seng China Enterprises Index, which measures 43 so-called H shares of Chinese companies.
Tu's comments ``had a negative impact on the local market and stocks with higher premium over their Hong Kong shares were dumped,'' said Wang Zheng, who manages the equivalent of $500 million at the asset management unit of Everbright Securities Co. in Shanghai.
Bank of Communications Co. and Aluminum Corp. of China Ltd.'s A shares paced the declines in China, with the CSI 300 Index sliding the most since Sept. 11. The two companies' H shares rose in Hong Kong, where the Hang Seng Index breached 30,000 for the first time.
The CSI 300, which tracks yuan-denominated A shares listed on China's two exchanges, slid 3.6 percent to 5,615.75 at the 3 p.m. close in Shanghai. The Hang Seng gained 0.6 percent to 29,465.05. It earlier touched 30,025.07. The H-share index added 1 percent to 19,722.38, after climbing as much as 5 percent.
Narrowing The Gap
The CSI 300 has jumped 175 percent this year, the most among 90 key stock indexes tracked by Bloomberg, valuing it at an average 54 times reported earnings. That's more than the 31 times for the Hang Seng China, which has gained 91 percent in 2007.
Tu's comments in Beijing raised expectations there will be measures installed to help narrow that gap. The regulator will announce the result of its study ``soon,'' Tu said.
C.K. Chan, a spokesman for the city's Securities and Futures Commission, declined to comment on such a plan today, as did Wong Hing-fung, a spokesman for the Hong Kong Monetary Authority, the city's de facto central bank.
Bank of Communications, China's fourth-largest lender by market value, fell 3.6 percent to 14.82 yuan in Shanghai. It climbed 7.1 percent to HK$11.72 in Hong Kong. Aluminum Corp.'s Shanghai shares slumped 6.2 percent to 50.72 yuan. The Hong Kong stock gained 2.9 percent to HK$24.80. The company, known as Chalco, is China's biggest aluminum producer.
Free Float
``It is reasonable to expect a much bigger impact on the A shares prices than a positive impact on H share prices,'' Vincent Chan, an analyst at Credit Suisse Group analyst wrote in a report today.
The percentage of free-float listed A shares is much smaller than for H shares, he wrote. If the two types of shares became fungible, large amounts of H shares would be swapped into A shares.
Chinese companies list in Hong Kong to lure international investors prohibited from buying shares on mainland exchanges. The market value of so-called H shares and red chips accounted for 53 percent of the total for the Hong Kong stock exchange's main board at the end of September, up from 26 percent at the end of 2002, according to the bourse's Web site. In 1997, when the U.K. handed Hong Kong back to China, they accounted for 16 percent.
China Eastern Airlines Corp., the country's third-largest carrier, slid 8.4 percent to 16.35 yuan in Shanghai. It added 2 percent to HK$8.01 in Hong Kong. Jiangxi Copper Co.'s A shares slid 6 percent to 65.95 yuan. The company, China's second-biggest copper producer, rose 4.1 percent to HK$30.75 in Hong Kong.
Years To Develop
Allowing arbitrage is ``clearly positive for H shares and Hong Kong in general,'' said Howard Wang, who oversees $30 billion as JF Asset Management Ltd.'s head of Greater China. Wang isn't changing his holdings just yet because the plan may take years to develop, the Hong Kong-based fund manager said.
Optimism for the plan to proceed may recede ``as people understand the further implications of this,'' Wang said.
The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, fell 3.5 percent to 5,825.28. The Shenzhen Composite Index dropped 2.5 percent to 1,494.59.
Tu's comments come on top of speculation mainland individuals will be allowed to invest directly in Hong Kong's equities. That expectation has helped fuel a two-month rally in the Hang Seng Index, driving the benchmark up 45 percent.
`Bite The Bullet'
``People don't know what to believe anymore but also don't want to miss out,'' said Brooke Babington, a trader at Helmsman Global Trading Ltd. in Hong Kong. ``They've got to bite the bullet.''
Analyst ``buy'' ratings on Hong Kong stocks jumped to 65 percent of recommendations last month, the highest percentage since January 2001, according to data compiled by Bloomberg. The last time they were as bullish was 2001 as the Internet bubble burst, and October 1997, when Asian currencies plummeted.
PetroChina Co., China's largest oil producer, gained 1.2 percent to HK$18.92. A 72 percent gain in its shares this year helped PetroChina to this week overtake General Electric Co. as the world's second-largest company by market value. Chairman Jiang Jiemin said on Oct. 15 that the company may debut in Shanghai next month.
Among Hong Kong-traded companies without a mainland listing, Cnooc Ltd., China's largest offshore oil producer, added 0.7 percent to HK$14.38.
China Studies Arbitrage Plan for Hong Kong Stocks
Oct. 17 (Bloomberg) -- China is studying a plan to allow arbitrage in shares of companies traded on domestic and Hong Kong exchanges, the nation's securities regulator said.
``We will announce the result of the study soon,'' Tu Guangshao, vice chairman of the China Securities Regulatory Commission said in Beijing today. The plan was proposed by Hong Kong authorities, he said, without elaborating.
Almost half the stocks traded in both markets are more than twice as expensive on the mainland because of limits on inward and outward investment. The regulator is seeking to end price discrepancies amid concern that a bubble is building at home after China's benchmark index almost tripled this year.
``This piece of news will give a boost to the Hong Kong market and might take some steam out of'' shares in Shanghai and Shenzhen, said Peter Alexander, principal at Shanghai-based research firm Z-Ben Advisors Ltd.
The plan would affect Chinese companies with so-called H shares traded in Hong Kong and A shares listed on either of China's two exchanges. China's stocks added $2.5 trillion in market capitalization this year and the CSI 300 Index is the world's most expensive major benchmark.
Companies on the CSI 300 trade at an average 56 times reported earnings, compared with 18 times for the S&P 500 Index, according to data compiled by Bloomberg.
Price Gap
Tu's remarks came after the Hong Kong exchange closed. The benchmark Hang Seng Index gained 1.2 percent today and is up 47 percent this year.
Hong Kong-traded shares of dual-listed companies such as China Petroleum & Chemical Corp. may benefit, said Steven Leung, a Hong Kong-based director of institutional sales at UOB-Kay Hian Ltd. Sinopec, as China's largest refiner is called, closed at HK$12.32 ($1.59) today in Hong Kong and at 26.13 yuan ($3.47) in Shanghai.
Investors can't profit from the price gap because of restrictions on currency conversion and stock ownership. Yuan- denominated A shares are available only to Chinese individual and institutional investors, as well as selected foreign investors.
H shares are denominated in Hong Kong dollars and trade on an open market. Mainland Chinese individuals, however, are so far restricted from investing in the city.
Through-Train
Only qualified foreign and domestic institutions picked by China's regulators can trade equities in both markets. Overseas firms including UBS AG and Goldman Sachs Group Inc. have been allowed to buy China's local-currency A shares under the qualified foreign institutional investor, or QFII, program. Selected domestic institutions are permitted to buy shares abroad under a qualified domestic institutional investor program.
It's ``inevitable'' for China to allow its citizens to buy shares overseas, Tu said today, reiterating that the regulator is considering letting individual Chinese investors buy Hong Kong- traded stocks under a plan dubbed the ``through-train.''
``China's QDII and through-train programs will be the key arbitrage vehicles in the near future,'' said Jing Ulrich, chairman of China equities at JPMorgan & Chase Co. in Hong Kong. Any other arbitrage mechanism ``won't happen overnight.''
The Hang Seng has rallied 36 percent since China announced the plan to allow citizens to buy Hong Kong stocks on Aug. 20.
``We will announce the result of the study soon,'' Tu Guangshao, vice chairman of the China Securities Regulatory Commission said in Beijing today. The plan was proposed by Hong Kong authorities, he said, without elaborating.
Almost half the stocks traded in both markets are more than twice as expensive on the mainland because of limits on inward and outward investment. The regulator is seeking to end price discrepancies amid concern that a bubble is building at home after China's benchmark index almost tripled this year.
``This piece of news will give a boost to the Hong Kong market and might take some steam out of'' shares in Shanghai and Shenzhen, said Peter Alexander, principal at Shanghai-based research firm Z-Ben Advisors Ltd.
The plan would affect Chinese companies with so-called H shares traded in Hong Kong and A shares listed on either of China's two exchanges. China's stocks added $2.5 trillion in market capitalization this year and the CSI 300 Index is the world's most expensive major benchmark.
Companies on the CSI 300 trade at an average 56 times reported earnings, compared with 18 times for the S&P 500 Index, according to data compiled by Bloomberg.
Price Gap
Tu's remarks came after the Hong Kong exchange closed. The benchmark Hang Seng Index gained 1.2 percent today and is up 47 percent this year.
Hong Kong-traded shares of dual-listed companies such as China Petroleum & Chemical Corp. may benefit, said Steven Leung, a Hong Kong-based director of institutional sales at UOB-Kay Hian Ltd. Sinopec, as China's largest refiner is called, closed at HK$12.32 ($1.59) today in Hong Kong and at 26.13 yuan ($3.47) in Shanghai.
Investors can't profit from the price gap because of restrictions on currency conversion and stock ownership. Yuan- denominated A shares are available only to Chinese individual and institutional investors, as well as selected foreign investors.
H shares are denominated in Hong Kong dollars and trade on an open market. Mainland Chinese individuals, however, are so far restricted from investing in the city.
Through-Train
Only qualified foreign and domestic institutions picked by China's regulators can trade equities in both markets. Overseas firms including UBS AG and Goldman Sachs Group Inc. have been allowed to buy China's local-currency A shares under the qualified foreign institutional investor, or QFII, program. Selected domestic institutions are permitted to buy shares abroad under a qualified domestic institutional investor program.
It's ``inevitable'' for China to allow its citizens to buy shares overseas, Tu said today, reiterating that the regulator is considering letting individual Chinese investors buy Hong Kong- traded stocks under a plan dubbed the ``through-train.''
``China's QDII and through-train programs will be the key arbitrage vehicles in the near future,'' said Jing Ulrich, chairman of China equities at JPMorgan & Chase Co. in Hong Kong. Any other arbitrage mechanism ``won't happen overnight.''
The Hang Seng has rallied 36 percent since China announced the plan to allow citizens to buy Hong Kong stocks on Aug. 20.
Eric Knight再抨擊匯控<0005.HK>業務策略
基金股東Eric Knight再次抨擊匯控<0005.HK>業務策略，昨日於英國報章刊登全版廣告，以童話故事「國王的新衣」來形容集團業務，嘲諷其口號「環球金融，地方智慧」，認為發展策略不足以產生協同效益。
Eric Knight指，匯控旗下投資銀行價值被嚴重侵蝕，要求將該部門分拆出售，再與競爭對手合併，以擴大環球業務規模。他又批評集團零售銀行資源錯配，發展過於分散，缺乏效益。
他表示，經過與40名機構投資者接觸的緘默期，對匯控攻勢現在才是序幕。惟《泰晤士報》指出，大部分股東對其建議均不感興趣，只有少數股東計劃公開支持。
Eric Knight指，匯控旗下投資銀行價值被嚴重侵蝕，要求將該部門分拆出售，再與競爭對手合併，以擴大環球業務規模。他又批評集團零售銀行資源錯配，發展過於分散，缺乏效益。
他表示，經過與40名機構投資者接觸的緘默期，對匯控攻勢現在才是序幕。惟《泰晤士報》指出，大部分股東對其建議均不感興趣，只有少數股東計劃公開支持。
Wednesday, October 17, 2007
Standard Chartered acquires 80 pct of Korean fund adminstrator A Brain Co
Standard Chartered PLC, the Asia-focused bank, said that it will acquire 80 pct of Korean fund administrator A Brain Co, Ltd (ABL) for an undisclosed sum, through its subsidiary company Standard Chartered First Bank Korea Limited.
SC First Bank will also have the option to buy the remaining 20 pct from January 2008, Standard Chartered said.
ABL had approximately 10 mln usd of total gross assets at end-March 2007.
It added that it expected the transaction to be completed by the end of 2007.
'ABL is a great fit with SC First Bank and a positive step forward in growing our Wholesale Banking business, 'David Edwards, President and CEO of SC First Bank said.
'Bringing ABL into the SC First Bank family highlights our determination to be the leading bank for Korean businesses and financial institutions by enhancing the comprehensive financial solutions we tailor for each of our clients.'
SC First Bank will also have the option to buy the remaining 20 pct from January 2008, Standard Chartered said.
ABL had approximately 10 mln usd of total gross assets at end-March 2007.
It added that it expected the transaction to be completed by the end of 2007.
'ABL is a great fit with SC First Bank and a positive step forward in growing our Wholesale Banking business, 'David Edwards, President and CEO of SC First Bank said.
'Bringing ABL into the SC First Bank family highlights our determination to be the leading bank for Korean businesses and financial institutions by enhancing the comprehensive financial solutions we tailor for each of our clients.'
Tuesday, October 16, 2007
PetroChina Surpasses GE as Second-Biggest Company
Oct. 15 (Bloomberg) -- PetroChina Co. gained the most in five months in Hong Kong trading as oil rose to a record above $85 a barrel, vaulting the state-owned oil producer over General Electric Co. to become the world's second-largest company.
The stock climbed 13 percent, valuing Beijing-based PetroChina at HK$3.36 trillion ($434 billion), compared with General Electric's $420 billion. Asia's biggest company is closing in on Exxon Mobil Corp.'s $518 billion value.
The rally, part of a record year for Chinese stocks, underscores PetroChina's key role in supplying oil to the world's fastest-growing major economy. U.S. billionaire Warren Buffett sold more than half of his stake in PetroChina this year. The stock has soared 14-fold since its 2000 public share sale.
``Chinese oil companies deserve higher valuations compared with their international peers, given the strong domestic economy and an expected influx of capital from mainland investors,'' said Wang Jing, a senior oil analyst with Orient Securities Co. Ltd. in Shanghai.
PetroChina may make further discoveries in the northern Liaohe and Dagang areas, Chairman Jiang Jiemin said at the Communist Party congress in Beijing today. The offshore finds will add to reserves from the Jidong Nanpu field, the nation's largest oil find in almost half a century.
China's biggest oil producer climbed as much as 14 percent to a record HK$18.94 a share and closed at HK$18.78 at 4 p.m.
`Share Surge'
``Petrochina's share surge is mainly due to investors' expectations of the company's further growth, high oil prices and a good market outlook,'' Jiang told reporters in Beijing.
Shares of the company may debut on the mainland stock exchange next month, Jiang said. PetroChina has completed ``all procedures'' for the sale and the stock may start trading in Shanghai in November, he said.
China's stock market regulator on Sept. 24 approved PetroChina's plan to sell as many as 4 billion yuan-denominated so-called A shares in Shanghai. The stock sale may raise $5 billion to expand refineries and boost output at oil fields, according to plans set out in PetroChina's listing prospectus.
Benchmark oil prices in New York today rose as much as 1.8 percent to a record $85.19 a barrel and traded at $84.87 at 7:32 p.m. Hong Kong time.
PetroChina and its nearest domestic rivals, China Petroleum & Chemical Corp. and Cnooc Ltd., led gains in Hong Kong amid increased optimism among fund managers after the Chinese government said on Aug. 20 that some of its citizens will be allowed to invest in the territory's shares. Household savings in China total $2.3 trillion and JPMorgan Chase & Co. estimates $60 billion of that may flow into Hong Kong in the next year.
Exodus
The plan to allow investment in Hong Kong shares has been delayed, officials at China's bank regulator said on Sept. 5 because of concern about a potential exodus of funds from stock exchanges in Shanghai and Shenzhen.
Almost all of this year's 44 percent gain in the Hang Seng Index, dominated by Chinese companies, took place since the government announcement. The Hang Seng advanced 3.6 percent last week and climbed above 29,000 for the first time. The 2007 gain compares with 40 percent for the Morgan Stanley Capital International Emerging Markets Index, 10 percent for the Standard & Poor's 500 Index and 7 percent for the Dow Jones Stoxx 600 Index of European shares.
Berkshire
Buffett's Berkshire Hathaway Inc. pared its stake in the Beijing-based company's Hong Kong stock to 3.1 percent from 11 percent in May, according an Oct. 10 U.S. stock exchange filing. As of the end of last year, Berkshire was the largest non- government shareholder, with about 13 percent of the publicly held stock, according to Berkshire's annual report.
Berkshire first reported disposing of its PetroChina shares two months after calls by activists for investors to shed PetroChina shares because the company's state-run parents has developed fields in Sudan, whose government is accused by the U.S. of supporting genocide.
PetroChina's third-quarter production climbed 5.6 percent to the equivalent of 275.4 million barrels (about 3 million barrels a day), the company said today. The output growth outpaced second-quarter production at Royal Dutch Shell Plc and Chevron Corp.
`Strong Buy'
``The overall growth in oil and gas output accelerated in the third quarter,'' said Gordon Kwan, head of China energy research at CLSA Ltd. ``The stock is a strong buy on the back of these statistics.''
PetroChina expects to outspend Exxon and Shell this year as it drills deeper and further afield and expands refineries. Capital spending may jump to 185.7 billion yuan this year from 148.7 billion yuan in 2006, the company said in March.
Exxon, the world's biggest oil company, set a capital budget of $21 billion for this year, the Irving, Texas-based company said March 7. Shell, Europe's largest oil company, said Feb. 1 it will spend as much as $23 billion to stem an expected fifth year of declining production.
PetroChina on Aug. 23 reported first-half net income rose 1.4 percent to a record 81.83 billion yuan as refineries returned to profit and tax payments fell.
The stock climbed 13 percent, valuing Beijing-based PetroChina at HK$3.36 trillion ($434 billion), compared with General Electric's $420 billion. Asia's biggest company is closing in on Exxon Mobil Corp.'s $518 billion value.
The rally, part of a record year for Chinese stocks, underscores PetroChina's key role in supplying oil to the world's fastest-growing major economy. U.S. billionaire Warren Buffett sold more than half of his stake in PetroChina this year. The stock has soared 14-fold since its 2000 public share sale.
``Chinese oil companies deserve higher valuations compared with their international peers, given the strong domestic economy and an expected influx of capital from mainland investors,'' said Wang Jing, a senior oil analyst with Orient Securities Co. Ltd. in Shanghai.
PetroChina may make further discoveries in the northern Liaohe and Dagang areas, Chairman Jiang Jiemin said at the Communist Party congress in Beijing today. The offshore finds will add to reserves from the Jidong Nanpu field, the nation's largest oil find in almost half a century.
China's biggest oil producer climbed as much as 14 percent to a record HK$18.94 a share and closed at HK$18.78 at 4 p.m.
`Share Surge'
``Petrochina's share surge is mainly due to investors' expectations of the company's further growth, high oil prices and a good market outlook,'' Jiang told reporters in Beijing.
Shares of the company may debut on the mainland stock exchange next month, Jiang said. PetroChina has completed ``all procedures'' for the sale and the stock may start trading in Shanghai in November, he said.
China's stock market regulator on Sept. 24 approved PetroChina's plan to sell as many as 4 billion yuan-denominated so-called A shares in Shanghai. The stock sale may raise $5 billion to expand refineries and boost output at oil fields, according to plans set out in PetroChina's listing prospectus.
Benchmark oil prices in New York today rose as much as 1.8 percent to a record $85.19 a barrel and traded at $84.87 at 7:32 p.m. Hong Kong time.
PetroChina and its nearest domestic rivals, China Petroleum & Chemical Corp. and Cnooc Ltd., led gains in Hong Kong amid increased optimism among fund managers after the Chinese government said on Aug. 20 that some of its citizens will be allowed to invest in the territory's shares. Household savings in China total $2.3 trillion and JPMorgan Chase & Co. estimates $60 billion of that may flow into Hong Kong in the next year.
Exodus
The plan to allow investment in Hong Kong shares has been delayed, officials at China's bank regulator said on Sept. 5 because of concern about a potential exodus of funds from stock exchanges in Shanghai and Shenzhen.
Almost all of this year's 44 percent gain in the Hang Seng Index, dominated by Chinese companies, took place since the government announcement. The Hang Seng advanced 3.6 percent last week and climbed above 29,000 for the first time. The 2007 gain compares with 40 percent for the Morgan Stanley Capital International Emerging Markets Index, 10 percent for the Standard & Poor's 500 Index and 7 percent for the Dow Jones Stoxx 600 Index of European shares.
Berkshire
Buffett's Berkshire Hathaway Inc. pared its stake in the Beijing-based company's Hong Kong stock to 3.1 percent from 11 percent in May, according an Oct. 10 U.S. stock exchange filing. As of the end of last year, Berkshire was the largest non- government shareholder, with about 13 percent of the publicly held stock, according to Berkshire's annual report.
Berkshire first reported disposing of its PetroChina shares two months after calls by activists for investors to shed PetroChina shares because the company's state-run parents has developed fields in Sudan, whose government is accused by the U.S. of supporting genocide.
PetroChina's third-quarter production climbed 5.6 percent to the equivalent of 275.4 million barrels (about 3 million barrels a day), the company said today. The output growth outpaced second-quarter production at Royal Dutch Shell Plc and Chevron Corp.
`Strong Buy'
``The overall growth in oil and gas output accelerated in the third quarter,'' said Gordon Kwan, head of China energy research at CLSA Ltd. ``The stock is a strong buy on the back of these statistics.''
PetroChina expects to outspend Exxon and Shell this year as it drills deeper and further afield and expands refineries. Capital spending may jump to 185.7 billion yuan this year from 148.7 billion yuan in 2006, the company said in March.
Exxon, the world's biggest oil company, set a capital budget of $21 billion for this year, the Irving, Texas-based company said March 7. Shell, Europe's largest oil company, said Feb. 1 it will spend as much as $23 billion to stem an expected fifth year of declining production.
PetroChina on Aug. 23 reported first-half net income rose 1.4 percent to a record 81.83 billion yuan as refineries returned to profit and tax payments fell.
Thursday, October 11, 2007
鄧普頓料中石油<0857.HK>股價將持續上升，或再增持
鄧普頓資產管理董事總經理麥樸思預料，中石油<0857.HK>股價將持續上升。
對於「股神」畢菲特今年逐步減持中石油，他表示有關減持不一定令股價下跌，而該行將繼續投資或增持中石油。
對於「股神」畢菲特今年逐步減持中石油，他表示有關減持不一定令股價下跌，而該行將繼續投資或增持中石油。
畢菲特再減持中石油<0857.HK>約2.34億股至4.33%
聯交所資料顯示，畢菲特旗下旗艦巴郡於9月27日，以每股平均價$13.89，再減持中石油<0857.HK>約2.34億股，涉資約32.5億元，其持股量已由5.44%減至4.33%，為第7次減持。不過，巴郡已向美國監管當局申報，截至9月30日止，其於中石油持股量已降至3.1%。
Buffett seen quitting PetroChina, Sudan spotlight
HONG KONG, Oct 10 (Reuters) - U.S. investor Warren Buffett's Berkshire Hathaway (BRKa.N: Quote, Profile, Research), which has slashed its holding in Chinese oil giant PetroChina (0857.HK: Quote, Profile, Research), may have sold up altogether, which would free it from criticism over links to Sudan, analysts said.
The next declaration of a sale would take Berkshire's interest below 5 percent, the threshold above which the firm is required to declare any shareholding changes that cross a full percentage point.
But analysts suspect Buffett is about to leave the stock entirely, if he hasn't already done so.
"Considering the price level (HK$13-15) and volumes (average of 400 million/day) traded in PetroChina since Sept. 25, we would not be surprised if Buffett has already sold off his entire stake," said JP Morgan analyst Brynjar Eirik Bustnes in a note.
CLSA oil and gas analyst Gordon Kwan said he thought Buffett could complete his exit by the end of October.
Buffett held 11.05 percent of PetroChina's free-floating shares until July, when he began a series of sales. The sixth sale, which took place on Sept. 25 but was only declared on Tuesday, left his interest at 5.44 percent.
PetroChina's share price has rocketed since Buffett paid an estimated HK$1.60 per share in April 2003 and he has locked in a return of around 600 percent. The shares stood at HK$14.42 at 0545 GMT on Wednesday.
PetroChina's parent company, state-owned CNPC, is a leading investor in Sudan, helping the oil industry there to develop despite U.S. sanctions. Activist groups have said Berkshire's investment supported genocide in the Sudanese region of Darfur and they have welcomed the sell-off.
"While Mr. Buffett is rightfully keeping quiet about his motives, it is increasingly clear that his pattern of sales indicates that he no longer wants to be associated with an investment that helps to fund genocide," activist group Investors Against Genocide said in a statement on Tuesday.
Berkshire Hathaway's shareholders quashed a proposal to sell out of PetroChina at its annual meeting in May in a non-binding vote. Berkshire's board defended the investment by saying that although CNPC had operations in Sudan, PetroChina did not.
The next declaration of a sale would take Berkshire's interest below 5 percent, the threshold above which the firm is required to declare any shareholding changes that cross a full percentage point.
But analysts suspect Buffett is about to leave the stock entirely, if he hasn't already done so.
"Considering the price level (HK$13-15) and volumes (average of 400 million/day) traded in PetroChina since Sept. 25, we would not be surprised if Buffett has already sold off his entire stake," said JP Morgan analyst Brynjar Eirik Bustnes in a note.
CLSA oil and gas analyst Gordon Kwan said he thought Buffett could complete his exit by the end of October.
Buffett held 11.05 percent of PetroChina's free-floating shares until July, when he began a series of sales. The sixth sale, which took place on Sept. 25 but was only declared on Tuesday, left his interest at 5.44 percent.
PetroChina's share price has rocketed since Buffett paid an estimated HK$1.60 per share in April 2003 and he has locked in a return of around 600 percent. The shares stood at HK$14.42 at 0545 GMT on Wednesday.
PetroChina's parent company, state-owned CNPC, is a leading investor in Sudan, helping the oil industry there to develop despite U.S. sanctions. Activist groups have said Berkshire's investment supported genocide in the Sudanese region of Darfur and they have welcomed the sell-off.
"While Mr. Buffett is rightfully keeping quiet about his motives, it is increasingly clear that his pattern of sales indicates that he no longer wants to be associated with an investment that helps to fund genocide," activist group Investors Against Genocide said in a statement on Tuesday.
Berkshire Hathaway's shareholders quashed a proposal to sell out of PetroChina at its annual meeting in May in a non-binding vote. Berkshire's board defended the investment by saying that although CNPC had operations in Sudan, PetroChina did not.
Warren Buffett cuts stake further in Hong Kong-listed PetroChina to 5.44 pct
HONG KONG (XFN-ASIA) - Billionaire global investor Warren Buffett further sold another 220.5 mln shares in PetroChina on Sept 25,reducing his personal stake in the Hong Kong-listed Chinese oil company to 5.44 pct from 6.49 pct, according to a stock exchange disclosure.
Buffett, the chief executive officer of Berkshire Hathaway Inc (nyse: BRKA - news - people ), sold the shares at an average price of 12.8 hkd per share for a total of 2.82 bln hkd.
Buffet had sold 66.61 mln shares in PetroChina (nyse: PTR - news - people ) on Sept 21.
In today's trade, PetroChina was up 0.18 hkd or 1.28 pct at 14.28.
Buffett, the chief executive officer of Berkshire Hathaway Inc (nyse: BRKA - news - people ), sold the shares at an average price of 12.8 hkd per share for a total of 2.82 bln hkd.
Buffet had sold 66.61 mln shares in PetroChina (nyse: PTR - news - people ) on Sept 21.
In today's trade, PetroChina was up 0.18 hkd or 1.28 pct at 14.28.
Standard Chartered Replaces Heads of Korea, Hong Kong Units
Oct. 10 (Bloomberg) -- Standard Chartered Plc, the U.K. bank that gets most of its profit from Asia, replaced the heads of its South Korean and Hong Kong units.
The company, based in London, appointed Ben Hung to succeed Peter Sullivan, who's retiring effective Dec. 31, as head of its Hong Kong operations. David Edwards was named to lead the Korean unit, replacing John Filmeridis, according to a regulatory filing.
Hung, 43, has been with the bank for 15 years and led the Hong Kong consumer banking division to record net income in the first half, said Standard Chartered Chief Executive Officer Peter Sands in a memo sent to employees. Sullivan, 59, said he's moving to London to be with his children.
``I hope to stay connected to Hong Kong,'' he said in an interview. Sullivan said he might take an advisory role at a bank, adding that ``it would depend on which bank. My loyalty is first and foremost with Standard Chartered.''
Sullivan, an Australian, was appointed chief executive officer of Standard Chartered Bank (Hong Kong) Ltd. in November 2004. He joined Standard Chartered from Citigroup Inc. 13 years ago.
Separately, Standard Chartered said the board of Korean unit SC First Bank Korea Ltd. approved the appointment of Edwards, 54. Edwards was previously chief operating officer for wholesale banking.
The company, based in London, appointed Ben Hung to succeed Peter Sullivan, who's retiring effective Dec. 31, as head of its Hong Kong operations. David Edwards was named to lead the Korean unit, replacing John Filmeridis, according to a regulatory filing.
Hung, 43, has been with the bank for 15 years and led the Hong Kong consumer banking division to record net income in the first half, said Standard Chartered Chief Executive Officer Peter Sands in a memo sent to employees. Sullivan, 59, said he's moving to London to be with his children.
``I hope to stay connected to Hong Kong,'' he said in an interview. Sullivan said he might take an advisory role at a bank, adding that ``it would depend on which bank. My loyalty is first and foremost with Standard Chartered.''
Sullivan, an Australian, was appointed chief executive officer of Standard Chartered Bank (Hong Kong) Ltd. in November 2004. He joined Standard Chartered from Citigroup Inc. 13 years ago.
Separately, Standard Chartered said the board of Korean unit SC First Bank Korea Ltd. approved the appointment of Edwards, 54. Edwards was previously chief operating officer for wholesale banking.
Wednesday, October 10, 2007
中石油在新疆拜城發現儲量超千億立方米大氣田
《中國日報》報道, 中石油(HK 0857)下屬塔裡木油田分公司近日在對新疆拜城縣境內大北三井的勘探開發獲重大發現, 經測算日產天然氣28.6萬立方米, 初步探明大北三井構造區天然氣資源總儲量達1,300億立方米。 報道稱, 在此之前, 拜城縣境內已探明的克拉二氣田天然氣儲量為2,500多億立方米, 庫車縣境內迪那二氣田已累計探明天然氣地質儲量1,700多億立方米。大北三井構造區將成為當地發現的第3個儲量超千億立方米的大氣田。 報道指出, 克拉二氣田是中國西氣東輸工程的主力氣田, 迪那二氣田是西氣東輸的二期資源。中石油塔裡木油田分公司有關人士表示, 大北三井構造區將與克拉二、迪那二氣田一起, 為“西氣東輸”提供充足的氣源保證。
Monday, October 8, 2007
HSBC Rejects California Teachers' Call for Strategic Review
Oct. 7 (Bloomberg) -- HSBC Holdings Plc, Europe's biggest bank, rejected a call from the California State Teachers' Retirement System for an outside strategic review.
Calstrs, based in Sacramento, wrote to HSBC Chairman Stephen Green criticizing the bank for its ``casual dismissal'' of ``very serious long-term'' performance and governance issues raised by Knight Vinke Asset Management LLC, the U.K.'s Observer newspaper reported today, saying it had seen the letter.
``The board sees no need for a further strategic review having already undertaken such a review earlier this year,'' London-based HSBC said in an e-mailed statement today distributed by external public relations firm Maitland. ``We believe that the principal points made by Knight Vinke have already been fully addressed.''
Knight Vinke, the activist investor that campaigned to block Suez SA's merger with Gaz de France SA, asked HSBC Chairman Green and the board last month for a ``fundamental review'' of strategy and management after the bank reported a drop in earnings due to losses from mortgages to borrowers with poor credit histories.
HSBC said Sept. 20 that Senior Independent Director Simon Robertson had rejected Knight Vinke's request.
The lender was the fourth-worst performer on Hong Kong's benchmark Hang Seng Index over the 12 months to Oct. 1, though the company's Hong Kong-listed shares last week had their biggest weekly advance in more than four years on optimism that earnings will recover.
`Diversified, Capitalized'
``We are one of the world's most diversified and strongly capitalized banks and our strengths are particularly obvious in the current market environment,'' HSBC said in its statement.
The company's London-listed shares have gained 3.3 percent this year, compared with the 5.1 percent decline in the 114- member Bloomberg European Financial Index. HSBC has a market value of 113.2 billion pounds ($231 billion).
Calstrs oversaw a total of about $169 billion as of July 31. It has $300 million invested in HSBC shares, and $1.5 billion in its corporate bonds, the Observer reported.
Calstrs, based in Sacramento, wrote to HSBC Chairman Stephen Green criticizing the bank for its ``casual dismissal'' of ``very serious long-term'' performance and governance issues raised by Knight Vinke Asset Management LLC, the U.K.'s Observer newspaper reported today, saying it had seen the letter.
``The board sees no need for a further strategic review having already undertaken such a review earlier this year,'' London-based HSBC said in an e-mailed statement today distributed by external public relations firm Maitland. ``We believe that the principal points made by Knight Vinke have already been fully addressed.''
Knight Vinke, the activist investor that campaigned to block Suez SA's merger with Gaz de France SA, asked HSBC Chairman Green and the board last month for a ``fundamental review'' of strategy and management after the bank reported a drop in earnings due to losses from mortgages to borrowers with poor credit histories.
HSBC said Sept. 20 that Senior Independent Director Simon Robertson had rejected Knight Vinke's request.
The lender was the fourth-worst performer on Hong Kong's benchmark Hang Seng Index over the 12 months to Oct. 1, though the company's Hong Kong-listed shares last week had their biggest weekly advance in more than four years on optimism that earnings will recover.
`Diversified, Capitalized'
``We are one of the world's most diversified and strongly capitalized banks and our strengths are particularly obvious in the current market environment,'' HSBC said in its statement.
The company's London-listed shares have gained 3.3 percent this year, compared with the 5.1 percent decline in the 114- member Bloomberg European Financial Index. HSBC has a market value of 113.2 billion pounds ($231 billion).
Calstrs oversaw a total of about $169 billion as of July 31. It has $300 million invested in HSBC shares, and $1.5 billion in its corporate bonds, the Observer reported.
Friday, October 5, 2007
BROKER CALL - HSBC rally to be short lived; target 114 hkd - CLSA
HONG KONG, Oct 05, 2007 (XFN-ASIA via COMTEX) --
CLSA said HSBC Holdings' recent rally will not last as current earnings are disappointing and the outlook for future earnings is not bright.
The brokerage has a "sell" call on the bank with a target price of 114 hkd. However, the report did not say what its previous target price was.
"At current levels we are close to similar levels before the bank made its disclosure on sub-prime loan problems late in 2006 and only 8 pct off all time highs," CLSA said, adding that HSBC is just entering a provision cycle.
It noted that shares in the bank have gone down quite considerably -- from 30-50 pct historically -- during times of rising provisions.
It noted that its balance sheet risk is higher with equity-to-assets now at 5.6 pct, compared with 6.8 pct in December 2000 and 5.7 pct in 1997.
It added that the market will be watching the third-quarter results of the bank's unit HSBC Finance and HSBC USA next month.
HSBC closed up 1.8 hkd or 1.21 pct at 150.8 today, rising for the fourth consecutive session.
CLSA said HSBC Holdings' recent rally will not last as current earnings are disappointing and the outlook for future earnings is not bright.
The brokerage has a "sell" call on the bank with a target price of 114 hkd. However, the report did not say what its previous target price was.
"At current levels we are close to similar levels before the bank made its disclosure on sub-prime loan problems late in 2006 and only 8 pct off all time highs," CLSA said, adding that HSBC is just entering a provision cycle.
It noted that shares in the bank have gone down quite considerably -- from 30-50 pct historically -- during times of rising provisions.
It noted that its balance sheet risk is higher with equity-to-assets now at 5.6 pct, compared with 6.8 pct in December 2000 and 5.7 pct in 1997.
It added that the market will be watching the third-quarter results of the bank's unit HSBC Finance and HSBC USA next month.
HSBC closed up 1.8 hkd or 1.21 pct at 150.8 today, rising for the fourth consecutive session.
Tuesday, October 2, 2007
Dubai Gets Financing From HSBC for Stakes in OMX, LSE
Oct. 1 (Bloomberg) -- Borse Dubai agreed to loans from HSBC Holdings Plc to help its bid for at least $6.5 billion of shares in OMX AB and London Stock Exchange Group Ltd.
State-run Borse Dubai will determine how much to borrow after Swedish regulators decide on its OMX takeover offer, Chief Executive Officer Per Larsson said in an interview today, declining to specify an amount. HSBC will lend Dubai as much as $5.7 billion, said three people with direct knowledge of the deal, who wouldn't be identified as the agreement is private.
Borse Dubai and Nasdaq Stock Market Inc., which had been rivals for control of Nordic exchange OMX, agreed last month that Dubai would proceed with its bid and then hand the shares to Nasdaq. In return, Nasdaq would give almost 20 percent of its stock to Borse Dubai and sell it a 28 percent holding in the London Stock Exchange for about $1.6 billion.
``We have secured all the financing we need for the transactions from HSBC,'' Larsson said.
Borse Dubai owns or has agreements to buy a combined 47.6 percent of OMX, and is in talks with other shareholders to raise its stake above the 50 percent threshold needed to clinch a takeover, he said.
The Swedish Financial Supervisory Authority last week ruled that Nasdaq is a ``fit and proper'' owner for OMX, boosting the chances of Dubai and the U.S. exchange completing their deal.
Qatar Stake
HSBC's loans may help Dubai fend off counter bids for OMX as the Persian Gulf emirate vies with neighboring Qatar for shares in the Stockholm-based company.
State-run Qatar Investment Authority issued a statement urging OMX shareholders to ``take no action'' after Dubai and Nasdaq announced their agreement on Sept. 20. Qatar later that day said it bought 9.98 percent of OMX and 20 percent of the London Stock Exchange as part of a plan to ``take supportive holdings'' in European bourses.
Dubai countered on Sept. 26, announcing agreements to buy OMX shares at 265 kronor from a group including Investor AB, Nordea Bank AB and exchange founder Olof Stenhammar. Those deals lapse if a rival bids at least 303 kronor a share, and Dubai fails to match the new bidder within 15 banking days.
Mega-Loans
HSBC is among banks including Royal Bank of Scotland Group Plc, Deutsche Bank AG and Citigroup Inc. that are helping Dubai state companies borrow internationally.
``Debt markets have recovered a bit in the last two to three weeks, and banks are showing more appetite for lending to companies in emerging markets where they can see growth,'' said Sven Kreitmair, co-head of corporate credit research at UniCredit SpA in Munich. ``There aren't many mega-loan transactions in the market, but the banks need them to meet their annual targets,''
Dubai World, the state-run group that in August agreed to invest as much as $5.1 billion in Las Vegas casino company MGM Mirage, is seeking a $2.7 billion one-year loan from Royal Bank of Scotland, Deutsche Bank and Credit Suisse Group, a banker with direct knowledge of the deal said last month.
Container port operator DP World hired Deutsche Bank, Royal Bank of Scotland, Barclays Capital and Citigroup for a $2.5 billion five-year borrowing, the banker said.
Dubai World's loan will pay interest of 85 basis points more than the London interbank offered rate, rising to 110 basis points after six months. DP World's will pay 65 basis points over Libor before switching to a rate based on its credit ratings. A basis point is 0.01 percentage point.
Nasdaq got $2 billion of loans and a revolving credit from Bank of America Corp. and JPMorgan Chase & Co. to help pay for the OMX shares it will buy from Borse Dubai. Nasdaq has to purchase the OMX shares from Dubai by April for the deal to complete, according to a Sept. 20 filing.
OMX shares fell 1.4 percent to 275.5 kronor at 5:09 p.m. in Stockholm, valuing the company at 33.4 billion kronor. The shares have more than doubled this year.
Tim Harrison, spokesman for HSBC's investment bank in Dubai, declined to comment on Borse Dubai's financing.
State-run Borse Dubai will determine how much to borrow after Swedish regulators decide on its OMX takeover offer, Chief Executive Officer Per Larsson said in an interview today, declining to specify an amount. HSBC will lend Dubai as much as $5.7 billion, said three people with direct knowledge of the deal, who wouldn't be identified as the agreement is private.
Borse Dubai and Nasdaq Stock Market Inc., which had been rivals for control of Nordic exchange OMX, agreed last month that Dubai would proceed with its bid and then hand the shares to Nasdaq. In return, Nasdaq would give almost 20 percent of its stock to Borse Dubai and sell it a 28 percent holding in the London Stock Exchange for about $1.6 billion.
``We have secured all the financing we need for the transactions from HSBC,'' Larsson said.
Borse Dubai owns or has agreements to buy a combined 47.6 percent of OMX, and is in talks with other shareholders to raise its stake above the 50 percent threshold needed to clinch a takeover, he said.
The Swedish Financial Supervisory Authority last week ruled that Nasdaq is a ``fit and proper'' owner for OMX, boosting the chances of Dubai and the U.S. exchange completing their deal.
Qatar Stake
HSBC's loans may help Dubai fend off counter bids for OMX as the Persian Gulf emirate vies with neighboring Qatar for shares in the Stockholm-based company.
State-run Qatar Investment Authority issued a statement urging OMX shareholders to ``take no action'' after Dubai and Nasdaq announced their agreement on Sept. 20. Qatar later that day said it bought 9.98 percent of OMX and 20 percent of the London Stock Exchange as part of a plan to ``take supportive holdings'' in European bourses.
Dubai countered on Sept. 26, announcing agreements to buy OMX shares at 265 kronor from a group including Investor AB, Nordea Bank AB and exchange founder Olof Stenhammar. Those deals lapse if a rival bids at least 303 kronor a share, and Dubai fails to match the new bidder within 15 banking days.
Mega-Loans
HSBC is among banks including Royal Bank of Scotland Group Plc, Deutsche Bank AG and Citigroup Inc. that are helping Dubai state companies borrow internationally.
``Debt markets have recovered a bit in the last two to three weeks, and banks are showing more appetite for lending to companies in emerging markets where they can see growth,'' said Sven Kreitmair, co-head of corporate credit research at UniCredit SpA in Munich. ``There aren't many mega-loan transactions in the market, but the banks need them to meet their annual targets,''
Dubai World, the state-run group that in August agreed to invest as much as $5.1 billion in Las Vegas casino company MGM Mirage, is seeking a $2.7 billion one-year loan from Royal Bank of Scotland, Deutsche Bank and Credit Suisse Group, a banker with direct knowledge of the deal said last month.
Container port operator DP World hired Deutsche Bank, Royal Bank of Scotland, Barclays Capital and Citigroup for a $2.5 billion five-year borrowing, the banker said.
Dubai World's loan will pay interest of 85 basis points more than the London interbank offered rate, rising to 110 basis points after six months. DP World's will pay 65 basis points over Libor before switching to a rate based on its credit ratings. A basis point is 0.01 percentage point.
Nasdaq got $2 billion of loans and a revolving credit from Bank of America Corp. and JPMorgan Chase & Co. to help pay for the OMX shares it will buy from Borse Dubai. Nasdaq has to purchase the OMX shares from Dubai by April for the deal to complete, according to a Sept. 20 filing.
OMX shares fell 1.4 percent to 275.5 kronor at 5:09 p.m. in Stockholm, valuing the company at 33.4 billion kronor. The shares have more than doubled this year.
Tim Harrison, spokesman for HSBC's investment bank in Dubai, declined to comment on Borse Dubai's financing.
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