OCBC

OCBC: CLSA reckons that the potential gain from sale of non-core assets (United Engineers & WBL) is immaterial, which will result in a P&L gain of $60m for United Engineers and $21m for WBL. OCBC shares are currently trading at 1.4x FY15 P/B. House sees limited room for the shares to outperform given: i) unsupportive macro conditions ii) the integration of Wing Hang and build out of a more extensive North Asia strategy which will weigh on ROA in the near term iii) a lower structural ROE than peers (the associate accounting of BON will flatter reported ROE) iv) its capital needs and the relative vulnerability that this brings with it. DBS is CLSA's preferred pick in the sector.