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Chong Hing Bank Controlling Shareholder Still in Sale Talks

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Chong Hing Bank
Signage for Chong Hing Bank Ltd. is displayed outside the bank's headquarters in Hong Kong. Photographer: Jerome Favre/Bloomberg

Sept. 9 (Bloomberg) -- Chong Hing Bank Ltd., Hong Kong’s smallest family-run lender, said its controlling shareholder is still holding talks to sell a stake in the lender.

The owner of Liu Chong Hing Investment Ltd., the bank’s parent company, “remains in dialogue with certain independent third parties” regarding a possible sale, the companies said in a joint statement today. Liu Chong Hing is controlled by the bank’s founding Liu family.

The announcement follows a statement last month that a buyer had approached the owners. Takeover speculation has mounted since November, when Lau Wai-man was named the first chief executive officer of the bank from outside the family, which controls about 60 percent of the lender. Shares of Chong Hing Bank have doubled since his Nov. 28 appointment.

The controlling shareholder “has not reached any commitment nor entered into any agreements” on a sale and will provide monthly updates until there is a decision on whether to make an offer or not, according to today’s statement.

The lender fell 0.2 percent to HK$29.45 at 9:39 a.m. in Hong Kong, while the benchmark Hang Seng Index gained 0.9 percent.

A bid for the family’s stake in Chong Hing Bank could be HK$40 a share, or about 2.3 times book value, Oriental Daily News reported last month.

To contact the reporter on this story: Stephanie Tong in Hong Kong at stong17@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net

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