Bank of East Asia 0023

[winston]

not vested

DJ MARKET TALK: Bank Of East Asia +1.0%; China Growth Eyed-Broker

1026 [Dow Jones] Bank of East Asia (0023.HK) is up 1.0% at HK$29.10, outperforming the broader market (the HSI is down 1.3%) after news PCCW (0008.HK) chairman Richard Li raised his stake in the bank to 0.23% from 0.20% on October 24, by acquiring 665,600 shares at an average price of HK$27.091/share, based on an exchange filing.

"Repeated stake increases in BEA by its major holders suggest that investors are expecting strong growth from BEA's China business, especially with its China yuan-related business," says Alvin Cheung, associate director at Prudential Brokerage.

Li's stake buy follows Malaysian tycoon Quek Leng Chan-controlled Guoco Group's (0053.HK) stake increase in BEA to more than 14% on Oct. 11, which came less than three weeks after it raised its holding to 13%. He expects the stock to remain in a HK$28.00-HK$30.00 range in the near term.

Source: Dow Jones Newswire

[winston]

not vested

DJ MARKET TALK: Mirae Cuts Bank Of East Asia To Hold From Buy

1412 [Dow Jones] STOCK CALL: Mirae Asset cuts Bank of East Asia (0023.HK) to Hold from Buy, given its less attractive valuation of over 1.2X FY12 book after its recent share price rally to it SoTP valuation of HK$31.80 and the risk of a lower dividend payout.

Mirae tips BEA to report, on Tuesday, 18% on-year growth in FY11 net profit to HK$4.59 billion, or HK$2.23/share (consensus: HK$2.19/share).

Besides China expansion plan, Marie says investors would also focus on its credit risk, as its NPLs in China in 2H11 should have increased, and on the fund-raising plan ahead as the bank's core CAR could fall to only about 8% by 2011.

As such, Mirae remains cautious on its dividend payout, which is likely to be cut to 30% in FY11-13, from 49% in FY10, implying a dividend yield of only about 2%, one of the lowest among local peers.

BEA is up 1.2% at HK$30.65.

Source: Dow Jones Newswire

[winston]

not vested

MARKET TALK: BEA Lower; Thanks To Richard Li Selling


Source: Dow Jones Newswire

[winston]

not vested

Valuation

Current price is reflecting 1.3 times P/E which close to the five-year average of 1.5 times, due to the business prospects in China, the Group this should be able to enjoy a higher valuation, but the Group's cost-effectiveness ratio higher than its peers, as well as its core capital adequacy ratio low in the same industry, so we give “neutral “ rating, target price of $31.

Investors are advised to wait

Source: Phillips

[winston]

not vested

DJ UPDATE: Guoco Raises Stakes In Bank Of East Asia To 15.26%

--Guoco Group raises stakes in Bank of East Asia to 15.26% on March 21, from 14.99% previously
--Stake purchase triggers fresh speculation on a possible takeover by Guoco

HONG KONG (Dow Jones)--Guoco Group Ltd. (0053.HK)--the second-largest shareholder in Bank of East Asia Ltd. (0023.HK)--raised its stake in the blue chip lender to more than 15%, rekindling speculation about a possible takeover.

Malaysian tycoon Quek Leng Chan-controlled Guoco bought 5,475,822 shares in Bank of East Asia on March 21 at an average price of HK$28.994 each, in a deal valued around HK$158.77 million, according to a filing published by Hong Kong's stock exchange Tuesday. Guoco's interest in the local lender has now increased to 15.26% from 14.99%, it said.

A Bank of East Asia spokeswoman said the bank received notification from Guoco prior to the stock exchange filing, but she added Guoco is exercising the option to receive scrip shares under the scrip dividend scheme announced in mid-February.

Under the scheme, the 2011 second interim dividend would be payable to the qualifying shareholders by way of scrip shares.

The latest Guoco's stake increase came five months after raising its holding to above 14%.

Stock exchange regulations require major company shareholders to disclose changes in ownership only when it crosses each percentage point.

Guoco has been boosting its interest steadily in Bank of East Asia in recent years, and its stake in the bank exceeded 10% for the first time last February. The pace of purchases has increased in the last six months, fuelling market speculation that Guoco may seek a controlling interest in the bank.

On Oct. 11, Guoco boosted its stake in the bank to 14.03% from 14.00%, after raising its stake in the bank to 13.08% in late-September.

Source: Dow Jones Newswires

[winston]

not vested

BANK OF E ASIA (00023) maintained Underperform with TP lifted to HK$24.5 by BofA ML

Bank of America Merrill Lynch expects the pretax underlying profit of BANK OF E ASIA (00023) for the first half of 2012 to climb 1.3% year-on-year only.

The broker deems BANK OF E ASIA may not be able to keep the strong performance.

BANK OF E ASIA was maintained Underperform with target lifted to HK$24.4 from HK$23.5.


Source: AAStocks Financial News

[winston]

not vested

Bank of East Asia said it is expecting a better performance in the second half as Chinese government policies to boost the economy kick in, after earnings fell 6 percent in the first six months as a result of deteriorating credit quality in the mainland.

Source: SCMP

[winston]

Elliott Says Bank Of East Asia Can Sell At HK$60 A Share: Analysts Disagree

By Shuli Ren

But time has changed. Among Hong Kong banks, BEA has the largest exposure to assets in China.

30% of its book is in China, versus say, Wing Hang Bank’s 12.8%. HSBC’s subsidiary Hang Seng Bank (11.Hong Kong) has only 6.3% exposure.

Meanwhile, non-performing loan ratios at BEA have risen sharply, from only 0.49% in 2013 to 2.65% in the first-half of 2015.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... -disagree/

[winston]

not vested

Bank of East Asia (0023.HK) — Upgrade to Buy: M&A Probability

Rises with Elliott’s Action

Elliott has urged fellow BEA shareholders to support its call for exploring auction options to sell the bank at a premium. Its moves may or may not result in an M&A, but they could result in BEA taking action to maximize shareholder value.

Based on higher M&A probability and attractive valuations, we upgrade BEA to Buy from Neutral.

Given the combined stake of Elliot and Guoco, which we believe will also support an auction sale to maximize returns, the probability of BEA becoming an M&A target rises.

We thus raise the M&A probability in our blended target price to 30% now, from 20% in Feb-2015 and 15% in Sep-2014 .

Our new target price of HK$28.80 (from HK$26.50) represents a 2016E PB of 0.9x.

Besides M&A, other options for BEA include disposal of non-core assets, revaluation of carried-at-cost premises, striking more partnerships, and capitalraising by introducing new strategic shareholders.

Source: Citi

[winston]

not vested

<Blue Chip Results>BANK OF E ASIA 2015 Net Profit Drops 17.1%; 2nd Interim Div. $0.5

BANK OF E ASIA (00023.HK) announced that for the year ended 31 December 2015, its net profit fell 17.1% year-on-year to $5.522 billion with EPS equaled $1.95.

The second interim dividend of $0.5 and a total full-year dividend of $0.88 was declared. For 2014, a dividend of $1.11 was declared.

During the period, operating profit before impairment losses was $7.332 billion, representing a decrease of 12.5% over a year-ago period.

With the worsening economic environment in Mainland China, impairment losses on loans and advances grew by 106.4% to $2.042 billion. Operating profit after impairment losses was $5.273 billion, a decrease of 28.6% yearly.

Valuation gains on investment properties increased to $549 million. The major contribution came from investment properties in Hong Kong. The group shared after-tax profits from associates of $558 million, a decrease of 13.5% over 2014.

The group's net interest income decreased by 5.8% yearly to $11.934 billion. Its net interest margin narrowed from 1.78% in 2014 to 1.66% in 2015. The net interest margin at BEA China decreased by 38 bps to 1.82% in 2015, largely due to the interest rate cuts made by the PBOC and lower asset yields given BEA China?s reduced risk appetite.

Net income from services fee and commission edged down 1.1% year-on-year to $4.099 billion. Non-interest income decreased by 7.7% to $5.13 billion. Operating income decreased by 6.4% to $17.064 billion.

Since loan demand in Hong Kong and Mainland China remained sluggish in 2015, gross advances to customers dropped by 0.4% to $441.506 billion.

Total deposits from customers fell by 1.4% compared to the end of 2014 to $540.743 billion. Loan-to-deposit ratio was 76.4% at the end of December 2015, compared to 74.8% at the end of 2014.

The group said the total capital ratio, tier 1 ratio, and common equity tier 1 ratio were 17.2%, 13.7%, and 12.2%, respectively as at 31 December, 2015, which should adequately support the group's growth in the coming years.

The average liquidity coverage ratio was 137% for 2015.

Source: AAStocks Financial News