State-owned Postal Savings Bank of China (PSBC) has launched an initial public offering in Hong Kong worth up to $8.1 billion, with the vast majority of the deal covered by cornerstone investors. Tara Joseph reports.
Just when it seemed the champagne days were a thing of the past for Asia's investment bankers... Along comes the biggest IPO anywhere in the world this year. The state-owned Postal Savings Bank of China officially announcing its 8-point-2 billion dollar IPO... Eclipsing the other major new listings of 2016. SOUNDBITE (English) TARA JOSEPH, REUTERS CORRESPONDENT, SAYING: "This is China's sixth biggest lender - with more than 40 thousand branches across the country... It's going to be a whopping 130 million dollar payday for the bankers putting the deal together - including big U.S. players Bank of America Merrill Lynch, Goldman Sachs, JP Morgan and Morgan Stanley." This high profile IPO flies in the face to a rough year for China's economy. Banks are having a tough time and stock markets are volatile - with Shanghai's index down almost 15 percent this year. Investors are also deeply worried about a growing pile of souring loans at major banks across the country. But that's where the appeal of PSBC comes in. It's stack of loans is much lower than the national average... and its jaw-dropping total assets add up to more than a trillion dollars. Major investors have already agreed to buy and hold new shares for up to six months. Pointing to a solid start for trading - and a much needed gravy for a bruised financial services industry in the world's number two economy.