Shanghai-listed China Everbright Bank is pushing ahead with its initial public offering in Hong Kong after the stock offering was shelved several times because of a weak market.
The Beijing-based mid-sized lender is looking to raise US$2-2.5 billion this time, sharply down on its original target of US$6 billion, according to people familiar with the matter, who said the bank had submitted the necessary A1 filing to the Hong Kong stock exchange.
However, China Everbright Bank's Hong Kong listing is likely to coincide with choppy markets, with the Hang Seng Index falling below the key psychological 20,000 mark yesterday.
Tang Shuangning, the bank's chairman, told reporters in February that his priorities for the year included raising capital through various channels, including a Hong Kong listing.
China Everbright Bank's first attempt to list A shares in Shanghai and H shares in Hong Kong was in 2010, but the lender was forced to go public first in Shanghai, and put its H-share offering on hold because of weak market conditions.
Last year, the bank again tried to list in Hong Kong. It submitted its IPO application to the Hong Kong Stock Exchange, but cancelled its road show in June after receiving a weak response from institutional investors concerned about the outlook for the global economy.
Analysts said Everbright again faces challenging listing prospects in Hong Kong because investors are again becoming nervous about the euro zone's sovereign-debt crisis and the global economic picture.
The bank's valuation has also been hurt by the weak performance of mainland banking shares in Shanghai and Hong Kong. Investors generally tend to avoid bank shares during big market swings.
'It's very likely that Everbright's public listing could be postponed again,' said Sheng Nan, a senior analyst at CCB International, adding that markets were traditionally sluggish in May.
China Everbright Bank and Everbright Capital, which is also a joint global co-ordinator for the IPO, could not be reached for comment yesterday. China Everbright Bank's other joint global co-ordinators - CICC, Morgan Stanley and UBS - declined to comment.
Amount, in HK dollars, raised last month by Haitong Securities, the year's biggest IPO
- China Everbright seeks HK$2-2.5 billion