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Chong Hing Bank: Solid Foundations Laid with Clear Development Blueprint to Boost Future Development
HONG KONG, Sep 04, 2015 - (ACN Newswire) - Chong Hing Bank Limited (stock code: 1111) proposed earlier to raise approximately HK$3,708 million by way of the Rights Issue on the basis of one Rights Share for every two shares at the subscription price of HK$17.05 per Rights Share. The acceptance period of the Rights Shares has opened for Qualifying Shareholders on Tuesday (2 September) and will end at 4pm on 16 September (Wednesday).
With the aim to share the success of the Bank's future development with its shareholders, the net proceeds raised from the Rights Issue exercise will be used to expand the Bank's business, position the Bank for sustainable growth and to satisfy its capital adequacy requirements. It will also be used to reposition the Bank's branch network to focus on locations of strategic value and to upgrade the core banking information technology systems to enhance the Bank's infrastructure to support future growth.
During the first half of 2015, the Bank continued to expand and recorded a satisfactory profit growth despite the challenging business environment. Profit attributable to equity owners for the six months ended 30 June 2015 amounted to HK$726 million, an increase of 87% over that for the same period last year after excluding the net gains on disposal of Chong Hing Bank Centre in 2014, translating into annualised return on shareholders' equity of 14.89% and earnings of HK$1.50 per share. The satisfactory results were contributed by good assets and liabilities management with strong growth in total assets (increase 7% to HK$115,821 million), combined with the Bank's continued efforts in promoting high quality customers with better yield and cross-border banking business with the Mainland.
Looking ahead, Hong Kong will continue to be the main source of growth for the Bank. In order to capture the business opportunities, Chong Hing Bank plans to provide a wider range of products and services to diversify its sources of income. These plans include developing new products focusing on Renminbi-related services, developing cross-border banking products and services, and increasing cross-selling, in particular, mortgage, wealth management, retail brokerage and insurance services to diversify and strengthen its income stream.
Chong Hing Bank also plans to reposition its branch network with more strategic locations in Hong Kong and an increased number of both in-branch and offsite ATMs. The Bank will also deepen its customer segmentation through customer retention and new customer acquisition, to develop additional businesses with selected customer segments, such as Hong Kong corporates, to develop a small- and medium-sized enterprises model. To satisfy the increasing demand for internet banking services, the Bank also intends to upgrade its core banking information technology systems to enhance its infrastructure and to strengthen other electronic channels.
For the development in Mainland China, subject to regulatory approval, Chong Hing Bank intends to further expand its network in the Mainland, particularly in Guangdong Province, and to acquire more quality customers. The Bank plans to develop its corporate banking businesses by focusing on companies with cross-border operations and cross-banking needs, and grow its personal banking business targeting mainly high net worth individuals.
To achieve its growth plans in the PRC at a similar pace as its Hong Kong business, Chong Hing Bank is recruiting more high-quality banking professionals to build up its talent pool, upgrading its core banking information technology systems to enhance its infrastructure to support future growth, and actively seizing state-owned-enterprise business in both Hong Kong and China through referrals from the mother company, Yue Xiu Group. With the clear business development blueprint, Chong Hing Bank is set to capture more business opportunities with its enhanced business foundation.
Sectors: Daily Finance
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