OCBC

OCBC: Received valid acceptances of 97.52% for its voluntary general cash offer for Wing Hang Bank (WHB). OCBC will now exercise its right to compulsorily acquire remaining shares and subsequently delist Wing Hang Bank. The acquisition of WHB will expand OCBC’s China loan book by 81% and raise profits contribution to 16% (from 6% last year). However, the deal is unlikely to produce instant synergies between the two banks. Recall, the merger between DBS and Dao Heng took about 13 years before DBS was able to fully tap on commercial banking and the wealth management market in Hong Kong. Valuation wise, UOB is trading at a premium 1.4x P/B over peers OCBC at 1.3x and DBS at 1.2x.