Wing Hang sale edges closer in OCBC move

Oversea-Chinese Banking Corp, Southeast Asia's second-largest lender, is said to have placed a binding bid for Wing Hang Bank, taking the sale of Hong Kong's second-largest family-owned bank a step closer to completion.

The Singaporean bank could emerge as the frontrunner among the suitors, which are rumoured to include Agricultural Bank of China, China Minsheng Bank, Singapore's United Overseas Bank and China's Anbang Insurance.

If successful, OCBC could be the second Singaporean bank to enter the city since 2001, when DBS, the largest Southeast Asian lender, paid HK$4.3 billion to take over Dao Heng Bank.

"OCBC may be eyeing a big franchise in China in placing the bid," said Dominic Chan, an analyst at BNP Paribas. "It wants to follow DBS to expand the geographic footprint outside [the Association of Southeast Asian Nations]."

OCBC conducted due diligence and offered less than two times the book value, which Wing Hang was seeking, two people with knowledge of the matter said, asking not to be identified as the information is private.

The companies were discussing if they could bridge the valuation gap, the people said.

However, Chan said he was doubtful about the price OCBC was willing to pay.