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  1. #1
    Mid
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    Thailand set to allow foreign owner for ACL Bank

    Thailand set to allow foreign owner for ACL Bank
    (Reporting by Jason Szep; Editing by Alan Raybould)
    2010-02-18

    BANGKOK, Feb 18 (Reuters) - Thailand's Finance Ministry signalled on Thursday it would clear the way within days for a foreign buyer to take control of ACL Bank, giving fresh momentum to a $530 million bid by China's ICBC.

    "I think everybody sees the merits of the deal," Finance Minister Korn Chatikavanij told Reuters in an interview.

    Industrial and Commercial Bank of China (ICBC), the world's largest bank by market value, said last September it wanted to bid for the bank, after agreeing to buy a 19.26 percent stake from Bangkok Bank for 3.52 billion baht ($106 million).

    The Finance Ministry is the largest shareholder in ACL, Thailand's smallest lender, with 30.6 percent. Its stake, combined with Bangkok Bank's 19.26 percent, would give ICBC 49.86 percent of ACL.

    Foreign holdings of more than 49 percent in a bank need official approval.
    "The Ministry of Finance has been looking at the recommendation by the Bank of Thailand. The permanent secretary's job is to present his recommendation to me. It's now on my desk," Korn said. "I should be able to put my signature on this within days."

    "The recommendation is for me to use my powers to allow a foreign buyer, that is ICBC or whoever else that might choose to outbid ICBC in the tender."

    "It would be the first time that such power under this new law is used in a 'non-distress' situation," he added, referring to a 2008 law on bank ownership.

    ICBC agreed to pay 11.5 baht per share for Bangkok Bank's stake.

    The shares were quoted at 11.10 baht at 0800 GMT on Thursday, giving it a market value of 17.6 billion baht ($531 million).

    ($1=33.17 Baht)

    iii.co.uk
    (Reporting by Jason Szep; Editing by Alan Raybould)

  2. #2
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    Interesting move...does this mean that Thailand maybe on the slippery slope to becoming normal and far less xenophobic than the image given....


    Or have the ICBC just paid a shed load of cash in a 'lunchbox/bag' ????

  3. #3
    Mid
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    Chinese ain't real foreigners ........................

  4. #4
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    Quote Originally Posted by Mid
    Chinese ain't real foreigners
    This.

  5. #5
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    They should have thrown also the Thai Military Bank stake into the deal

  6. #6
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    just look at the outstanding ROE of ACL
    The Stock Exchange of Thailand : Companies/Securities in Focus

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    Quote Originally Posted by Mid View Post
    The Finance Ministry is the largest shareholder in ACL, Thailand's smallest lender, with 30.6 percent. Its stake, combined with Bangkok Bank's 19.26 percent, would give ICBC 49.86 percent of ACL.

    Foreign holdings of more than 49 percent in a bank need official approval.
    Well turning that 0.86% exceeding the 49% limit into NVDR (non voting depositary receipts) shouldn't be too difficult anyway, would it ?

  8. #8
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    I wouldn't buy bank stocks in Thailand, even with someone else money

  9. #9
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    china is coming folks
    the Dragon has awoken

  10. #10
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    I am forecasting a global economic collapse in China,

    there is massive offshore borrowing by Chinese companies, eventually they will default

    they will stop producing anything overnight when that happens,

    none of their statistics is credible

  11. #11
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    Thaksin's Chinese, isn't he? And he's going to need somewhere to stow all the money he's going to get back !!

  12. #12
    Mid
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    Quote Originally Posted by wefearourdespot View Post
    immaterial , the licence is the pot of gold

  13. #13
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    Quote Originally Posted by Butterfly View Post
    I am forecasting a global economic collapse in China,

    there is massive offshore borrowing by Chinese companies, eventually they will default

    they will stop producing anything overnight when that happens,

    none of their statistics is credible
    Far fetched speculation.....at best.

  14. #14
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    Quote Originally Posted by Mid View Post
    Quote Originally Posted by wefearourdespot View Post
    immaterial , the licence is the pot of gold
    yeah, for the Thais who sold it

  15. #15
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    Quote Originally Posted by Butterfly View Post
    I am forecasting a global economic collapse in China,

    there is massive offshore borrowing by Chinese companies, eventually they will default

    they will stop producing anything overnight when that happens,

    none of their statistics is credible
    A lot of the foreign money invested in China is actually profits from Chinese companies that are booked abroad (HK, BVI, ...) to avoid tax and then bring back to China as "foreign investment".

    Also I don't understand " eventually they will default then they will stop producing anything ... " Usually it works the other way around. As long as they manufacture and export, why do you want them to default on their debt ?

    Anyway, for the time being they don't really have any competition. An economist I forgot the name said the debate around their "undervalued" currency was stupid, as they don't have competition, if the RMB is more expensive, we will still buy Chinese goods, only we will pay more ...
    The things we regret most is the things we didn't do

  16. #16
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    Quote Originally Posted by Perota View Post
    Anyway, for the time being they don't really have any competition. An economist I forgot the name said the debate around their "undervalued" currency was stupid, as they don't have competition, if the RMB is more expensive, we will still buy Chinese goods, only we will pay more ...
    They have no competition because they are so cheap because of their undervalued RMB. If it is higher we will start to buy elsewhere again.

  17. #17
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    ^The arguments of some researches claiming that the RMB is severely
    undervalued could be motivated by political and international trade sanctions ...


    For more detail, pls follow this link : http://www.eurojournals.com/IRJFE%20depeg.pdf

  18. #18
    Mid
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    Industrial and Commercial Bank of China (SEHK: 1398) (ICBC), the world’s largest bank by market value, said it had acquired 97.24 per cent of Thailand’s smallest lender, ACL Bank, for about US$550 million

    Company & Finance News from Hong Kong & China | Hong Kong Business News | SCMP.com

  19. #19
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    Quote Originally Posted by Perota
    Also I don't understand " eventually they will default then they will stop producing anything ... " Usually it works the other way around. As long as they manufacture and export, why do you want them to default on their debt ?
    because I doubt they are making any real profits, and their margin might be too low to compensate for any hard times, they are just turning around cash with no long term plans. Their costs are getting higher, fueled by high local inflation, growth is there but it's only hiding their thin profit. For all we know, they could be making small loss instead of small gains. With no credible accounting standard in place, it's impossible to "understand" their book, and that's usually bad news. All third world countries go through these stages of "high growth" and "cheating", but eventually the "gravity" of reality will force them to recognize their accounting reality, and that will directly affect their balance sheet (capital, negative net equity). When that happens, it will be financial cahos. Could take quite a few years before it's being revealed. Thailand took 20 years.

    Quote Originally Posted by Perota
    Anyway, for the time being they don't really have any competition. An economist I forgot the name said the debate around their "undervalued" currency was stupid, as they don't have competition, if the RMB is more expensive, we will still buy Chinese goods, only we will pay more ...
    yes and no, but a small "revaluation" might be enough to impact the very thin "profit margin" of those Chinese companies, and fuck them over. That could explain the resistance of the Chinese government, they know how fragile their Chinese companies are, and it if was to happen suddenly, a lot of those small companies would go under and that could bring a cascading cahos effect there. It's possible the US is also aware of that and trying to break that "bubble" so they can start "invading" them financially and economically.

  20. #20
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    Quote Originally Posted by Butterfly
    because I doubt they are making any real profits, and their margin might be too low to compensate for any hard times, they are just turning around cash with no long term plans.
    So they are paying practically zero on deposits while charging 6% for minimum lending rate and paying an average salary of 18,000 baht for employee and you say they aren't doing any profits ?

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