Postcard from Shanghai

10 December 2019 By Robyn Mak Follow @mak_robyn

Postal Savings Bank shares opened flat on their Shanghai debut. Beijing’s rule of thumb that the price at least match book value is partly to blame. State funds may have gotten this deal over the line, but the poor market reception will make it harder for peers to recapitalise.

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Postal Savings Bank of China shares opened at 5.60 yuan per share on Dec. 13, their first day of trading on the Shanghai Stock Exchange. That compares to the offer price of 5.50 yuan.

PSBC, which is already listed in Hong Kong, raised 28.5 billion yuan ($4 billion). If an allotment to underwriters known as a green-shoe is exercised, the total amount raised would be 32.7 billion yuan.

Separately, the company on Dec. 9 said its biggest shareholder, China Post Group, has pledged to increase its shareholding by at least 2.5 billion yuan over a 12 month period.

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