OCBC

OCBC: CIMB tips strong investor interest for the banking group near-term, estimating non-core gains from the divestment of the combined 18.2% F&N and 7.92% APBrew stakes it holds with Great Eastern could top $1.5-2b (Citigroup estimates ~$1.2b). It estimates OCBC's purchase price for the F&N stake to be $3.52/share, while the APB cost may have been $13.87-17.33/share. This means that the bank's non-core gains can potentially dwarf its annual profits in 2012. House forecasts OCBC's FY12 net profit at $2.47b. Views capital management plans will be key as freed-up capital can provide ammunition for organic growth across its operating markets, beef up its war chest for acquisitions or be paid out as a one-time special dividend. It views the stake-sale talks as positive, but adds a potentially weaker 2Q12 could be a near-term de-rating catalyst, noting OCBC's exposure to market-derived fees makes its earnings volatile. It rates OCBC at Neutral with $9.51 target. The stock is flat at $9.25.