OCBC-Wing Hang Bank takeover poses transitional execution risks: Moody's

Recapitalizaton plan might have some snags.

Moody's Investors Service believes that the announced takeover by Oversea-Chinese Banking Corporation Ltd of Wing Hang Bank will impact OCBC's capitalization, and pointed out that the uncertainties around its short-term recapitalization plan.

"We placed OCBC on review for downgrade primarily because of the transaction's impact on OCBC's capitalization, in terms of both the initial drop in its capital ratios, and the execution risks surrounding its subsequent efforts for capital replenishment," says Gene Fang, a Moody's Vice President and Senior Analyst.

Fang was speaking on the release of a new credit focus, entitled "OCBC-Wing Hang Takeover Will Pose Transitional Execution Risks Before Benefits Are Reaped -- Answers to Frequently Asked Questions".
Beyond the risks related to OCBC's recapitalization plan, Moody's does not expect the transaction -- announced on 1 April -- to weaken OCBC' credit profile, given the strength of WHB's balance sheet and positioning in the Hong Kong and China markets.

"Strategically, the transaction will enlarge OCBC's platform in greater China, improve its ability to provide off-shore renminbi financing, and position its franchise to benefit from increasing intraregional trade and capital flows within Asia," adds Fang.

Moody's report gives greater detail on its assessment of the transactions' credit implications.

If you've been wondering whether SBR could work for your company — yes, probably.

A lot of the companies we partner with started as readers. They'd been following our coverage for a while, saw their own customers and competitors in it, and eventually asked the obvious question: could we do something with you? The answer is usually yes. The shape of it depends on what you're trying to do.

The options are broader than most people assume — thought leadership articles, sponsored content, industry summits across Southeast Asia, regional awards programmes, podcasts, and media placements in print and digital. Some partners use one channel; most use a mix. We figure out the right combination by starting with your brief, not with our rate card.

So if the question has been on your mind, here's the easy way to ask it.

We'll tell you honestly whether we can help, and how. It's a better use of everyone's time.

Book a meeting

| Or download the media kit (PDF)

240,000 senior readers quarterly in print Top 1,700 Singapore companies reached

7 markets across Southeast Asia