CMB given green light for HK funding
Updated: 2013-08-17 00:36
By GAO CHANGXIN (China Daily)
Bank in need of core capital after rapid expansion of its loan book
China Merchants Bank Co Ltd has won regulatory approval for an H-share rights issuance, lifting the barrier for a 35 billion yuan ($5.72 billion) fundraising plan to replenish much-needed core capital.
The nation's sixth-biggest lender said in a statement on Thursday that the China Securities Regulatory Commission has given the green light for its plan to issue 680 million shares in Hong Kong. Last month, it was given approval to sell 3.07 billion A-shares in Shanghai.
China Merchants Bank Co Ltd said on Friday its first-half net profit rose 12 percent from a year earlier, driven by growth in net interest income and higher fees.Zhen Huai / for China Daily
The approval marks an end to the Shenzhen-based bank's long fundraising journey. It first broached the idea of raising 35 billion yuan in July 2011 but didn't clear all the regulatory barriers until Thursday.
The bank said on Friday its first-half net profit rose 12 percent from a year earlier, driven by growth in net interest income and higher fees.
Its net profit for the first six months of the year ending June 30 totaled 26.27 billion yuan, up from 23.4 billion yuan a year earlier.
The result was higher than the average 25.94 billion yuan net profit forecast of four analysts polled earlier by Thomson One Analytics.
The bank is hungry for capital on the back of rapid loan-book expansion to 2.09 trillion yuan at the end of the second quarter, an increase of 10.1 percent from the end of last year.