The bank stands to raise US$11.3 billion, making it the world's fourth-largest IPO
Bank of China (BOC), the mainland's second-largest lender, has received strong demand from institutional investors for its US$9.8 billion initial public offering, which is set to be the largest ever in Hong Kong.
The IPO is being launched to Hong Kong retail investors today. It has already been more than five times oversubscribed by institutional investors on up to US$9.3 billion worth of shares allotted to them up to yesterday, sources close to the deal said.
About US$490 million of the shares have initially been set aside for retail investors, or 5 per cent of the total offering.
This will be raised to 20 per cent if the retail portion is oversubscribed 100 times or more, which is likely, given strong retail orders for the IPO by Tianjin Port Development Holdings, which closed yesterday.
The sources said the retail tranche of Tianjin Port's $1.08 billion deal was almost 1,700 times oversubscribed - a record in Hong Kong IPO history - and attracted $184.72 billion in subscription money.
Brokers said investors who missed the chance to subscribe to Tianjin Port's shares might place their bets on BOC, which is fielding strong demand from fund managers trying to gain exposure to the mainland's promising banking sector but who failed to buy into two earlier offerings by major Chinese lenders.