(25 May 2015 – Asia) Bank of China Hong Kong Ltd (BOCHK) may sell its Nanyang Commercial Bank Ltd unit to invest in banking operations and assets in Southeast Asia from its parent.
China’s Ministry of Finance needs to approve both transactions, which BOCHK and parent Bank of China Ltd said in a statement to the Hong Kong stock exchange on 21 May.
The sale of Nanyang “would be consistent with the long term development strategy of the group in Hong Kong and would enable a better allocation of resources,” the companies said.
At the end of January BOCHK made it clear it was reviewing its portfolio and would possibly sell some banking assets.
It is expected that Chinese buyers would be preferable for Nanyang.
Bank of China’s transfer of assets and operations in some Association of Southeast Asian Nations members to BOCHK will “accelerate the enhancement of customer service, product innovation and marketing capability and competitive edge of the group in the Asean region,” the companies said in the statement.
Hong Kong-based Nanyang had 42 branches in the city and 14 in mainland China at the end of 2013, with HK$280.4 billion (A$45.7 billion) of consolidated assets, according to its annual report.