Postal Savings Bank plans biggest China IPO since 2015

People walk past a sign outside a branch of Postal Savings Bank of China (PSBC) in downtown Beijing, China, November 12, 2015. REUTERS/Kim Kyung-Hoon/File Photo

Postal Savings Bank of China Co. is poised for the country’s biggest initial public offering since 2015.

The Beijing-based lender, which is already listed in Hong Kong, plans to raise 28.4 billion yuan ($4.1 billion) in what would be the world’s third-largest listing this year behind Uber Technologies Inc.’s $8.1 billion share sale in May and Budweiser Brewing Co.’s $5.8 billion IPO in Hong Kong in September.

One of China’s largest state-owned lenders, Postal Bank plans to issue 5.17 billion A-shares at 5.5 yuan per share, according to its Shanghai stock exchange filing Wednesday, which confirmed an earlier Bloomberg report.

If the bank fully exercises an over-allotment option of up to 776 million shares, the fundraising size may reach as much as 32.7 billion yuan, surpassing Guotai Junan Securities Co.’s 30 billion yuan offering in 2015. In doing so it would become the largest A-share listing since Agricultural Bank of China Ltd.’s 68.5 billion yuan offering in 2010, according to data compiled by Bloomberg.

The country’s banks are boosting capital at a record pace, mostly through debt sales, to beef up financial strength as they grapple with rising bad debt. Policy makers have also called on lenders to help revive its economic growth and increase loans to China’s cash-starved non-state sector, which would see them take on more risk. China’s equity financing market is heading to the first increase in volume this year since 2016.

Postal Bank has more than 40,000 outlets nationwide and over 550 million retail customers. The stock has gained 23% in Hong Kong this year. The A-share offer price represents a premium of about 20% to Tuesday’s close of HK$5.1 in Hong Kong. The stock rose 0.4% as of 11:16 a.m. in the city, after losing as much as 0.8% in morning trade.

Subscription was postponed to Nov. 28, from the original date of Thursday. China requires companies that price their shares above industry average to file risk warnings to investors for three weeks.

Bloomberg 

Singapore Reporter/s

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.