Friday, May 04, 2012

Temasek cuts stakes in China banks

SINGAPORE: Temasek Holdings said Thursday it had cut its stakes in two of China's largest banks by selling shares worth $2.48 billion.

The limited retreat from China Construction Bank (CCB) and Bank of China (BOC) is a "rebalancing" of its China portfolio after it upped its stake in mainland lending giant ICBC Bank in mid-April, a Temasek spokesman told AFP.

The firm on April 16 said it had reached an agreement to increase its stake in ICBC to 1.3 per cent by purchasing shares from US financial group Goldman Sachs for $2.3 billion.

"The rebalancing move is also partly to prepare for other opportunities that may arise in China and elsewhere," the spokesman said.

After the sale in CCB and BOC and the increased stakes in ICBC, Temasek will have "about $18 billion still invested in leading China banks," he added.

"We continue to see the leading Chinese banks as long-term proxies to the growing Chinese economy as well as the country's rising middle income groups," he said.

The sale of its Hong Kong-listed shares was made via placements, and Dow Jones Newswires cited people familiar with the deal as saying that the shares were priced at the low end of indicative ranges due to choppy market conditions.

It said Temasek sold 3.079 billion shares in BOC and 1.6 billion shares in CCB.

By the break in Hong Kong CCB shares were down 2.9 per cent and BOC was down 3.4 per cent.

Chinese businesses have featured prominently on Temasek's logbook in recent months, with the firm setting up a new investment arm specifically targeting privately-owned Chinese firms in January.

Temasek Holdings is one of two Singapore state investment firms and had a portfolio worth S$193 billion ($149.53 billion) for the financial year ended March 31, 2011.

- AFP/wk

View the original article here

Source From Channel News Asia

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