The Bank Starts A+H Rights Issue &Nbsp, And Expects To Raise 33 Billion 100 Million Yuan.

Just as the IPO of the Agricultural Bank of China will be meeting, the Bank of Communications (601328) (601328.SH, 03328.HK, hereinafter referred to as the "Bank of China") today issued the announcement on the issue of rights issue at the same time in A shares and H-shares, and is going to allot it to all shareholders according to the ratio of 10 to 1.5. The total number of shares can be allocated to 7 billion 349 million shares, including 3 billion 889 million A shares and 3 billion 460 million H-shares.

According to the announcement of the bank, its A share allotment price is RMB 4.5 yuan per share, the H share allotment price is HK $5.14 per share, according to the exchange rate conversion, the A shares are identical with the H-share rights issue, the A share allotment adopts the way of consignment, the H-share rights issue is underwritten, the total amount of A+H rights issue financing is estimated to be RMB 33 billion 100 million yuan, of which A shares are expected to raise 17 billion 500 million yuan, and H-share is expected to raise 15 billion 600 million yuan, all of which are used to supplement the core capital.

At the end of February this year, the board of directors of the Bank of China passed the resolution on the rights issue of A shares and H shares. It intends to raise no more than 42 billion yuan through the issue of rights issue, which is used to replenish capital after deducting the issuance cost. At the provisional shareholders' meeting held in April 20th, the financing scheme was strongly supported by the shareholders and approved by 99.93%. On May 28th, at the eighty-fourth meeting of the SFA on 2010, the application for rights issue of the bank was approved.

It is reported that the major shareholders, including the Ministry of Finance and HSBC, have indicated that they will subscribe in full.

Qiu Zhicheng, a banking analyst at Guoxin Securities, said in an interview with "First Financial Daily" yesterday that after the completion of the rights issue, the core capital adequacy ratio of the bank will be further improved. It is estimated that no equity financing will be carried out within two or three years after the completion of the rights issue. The capital replenishing mode may be mainly subordinated debt and other subsidiary capital modes.

UBS Securities pointed out that, with the market turmoil, the bank's stock price callback, 2010 and 2011 earnings are expected to be 8 times and 6.8 times, corresponding to the expected net market rate of 1.56 times and 1.37 times, the valuation is close to the lowest level in history.

Related stakeholders yesterday told the newspaper that the refinancing option was based on the ownership structure and market conditions. The biggest feature of the rights issue is that the existing shareholders have the right to participate in the rights issue, which has less impact on the ownership structure and less impact on the market. The rights issue is a more fair distribution method for all shareholders, and shareholders are entitled to enjoy the benefits from the bank's future growth.

The announcement shows that the registration date for the issue of the A shares issue is June 9th, the subscription payment period is from June 10th to 21st, and the A share issue online roadshow will be held in June 8th. The final trading day for the trading of H-shares is the June 10th.

Last Friday, the bank's A shares closed at 6.39 yuan, while H-shares closed at HK $8.19.