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JX seeks IPO valuation of up to USD 4.96bn
Posted on Wednesday, 13 June 2018 08:54
Jiangxi Bank (JX) has pulled the trigger on a listing in Hong Kong that could fetch as much as HKD 7.79 billion (USD 992.77 million) and give the mainland lender a valuation of HKD 34.74 billion and HKD 38.95 billion (USD 4.96 billion).

The initial public offering includes the introduction of Yango Investment, Road Shine Developments, Sinolending Fintech, China Finance and Fortis Insurance as cornerstone investors.

It comprises a sale of 1.17 billion H shares at HKD 5.94 to HKD 6.66 apiece, which values unaudited pro forma consolidated net tangible assets at HKD 5.90 to HKD 6.03 per share.

Proceeds from the listing, which includes the introduction of cornerstone investors, will strengthen the lender’s capital base to support ongoing business growth.

Backers consist of: Yango Investment; CITIC’s Road Shine, which also owns stock in Guon Internation, Munsun Capital and Alibaba Health Information; Shanghai Dianrong Financial Information’s investment arm; ZhongHua Financial; and FTLife Insurance.

JX is the only provincial city commercial bank in Jiangxi province, one of the fastest growing provinces in China in recent years, and it has been pushing into the economically developed Pearl River Delta and Yangtze River Delta Economic Zones.

As of 31st December 2017, the lender had a network covering 11 districted cities and 63 counties in the region.

It had total assets of CNY 370.00 billion (USD 57.77 billion) at 31st December 2017, while net profit amounted to CNY 2.91 billion for the 12 months of 2017 (FY 2016: CNY 1.68 billion; FY 2015: CNY 772.80 billion).

At the end of 2017, JX’s capital adequacy indicators were: core tier-one ratio of 9.4 per cent; capital adequacy ratio of 12.8 per cent; and total equity to total asset of 6.2 per cent.

State-owned Jiangxi Provincial Expressway is currently the bank’s largest shareholder with a pre-IPO 20.0 per cent stake, though this will be diluted to as low as 15.5 per cent, assuming the overallotment option is fully exercised.

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