Shanghai Commercial Bank to upgrade HQ

PUBLISHED : Wednesday, 10 September, 2008, 12:00am
UPDATED : Wednesday, 10 September, 2008, 12:00am

Shanghai Commercial Bank, a Hong Kong-based privately owned lender, may invest HK$500 million to HK$600 million to redevelop its headquarters in Central.

Managing director David Kwok Sek-chi said the new headquarters, which combined the existing complex and the adjacent CNAC Group Building it recently bought, would generate about 140,000 square feet in gross floor area.

The bank made a successful HK$1.388 billion tender last week for the CNAC Group Building at 10 Queen's Road Central.

The building has a gross floor area of about 70,000 sqft. Shanghai Commercial Bank's current headquarters has more than 40,000 sqft.

Mr Kwok said the bank was reviewing the possible redevelopment as it needed more office space for its business expansion. 'Our vision is to expand business by leveraging our advantage in Hong Kong, the mainland and Taiwan.'

Shanghai Commercial Bank, which holds 3 per cent of the mainland's Bank of Shanghai, is 57.6 per cent held by Taiwan's Shanghai Commercial and Savings Bank. The three lenders co-operated on credit cards, wealth management and other business referrals, Mr Kwok said. 'It's a good platform for us to further expand our business.'

Shanghai Commercial Bank plans to upgrade its Shanghai office and incorporate on the mainland. It has a branch in Shenzhen.

The lender said first-half net profit fell 12.1 per cent to HK$835 million on a 12.3 per cent decline in non-interest income, higher tax expenses and losses at its jointly controlled entities.

Mr Kwok expected full-year earnings to decline because of the challenging operating environment.

Separately, Mr Kwok said the bank was one of the lenders to troubled Peace Mark (Holdings) but the amount involved was small.

Peace Mark, the largest retailer of luxury watches in Asia, said last week that it could not meet creditors' demands for the settlement of HK$1.21 billion loans.