Bohai bank, which has fallen for many days, staged a “big dive”, and the share price per share fell below HK $1 several times during the day.
Shortly after the opening of trading on March 1, Bohai bank, a listed stock bank in Hong Kong stocks, suddenly fell. The intraday diving once fell by more than 28%, and the share price per share fell to HK $0.93, a record low.
A Hong Kong stock analyst pointed out to the Chinese reporter of the securities firm that the collapse of Bohai bank may be due to the forced closing of the Pledged Shares. Previously, Hong Kong stocks of Bank of Gansu also plunged 43% in one day. However, some bankers familiar with Hong Kong stocks hold different views: “it is rare for financial institutions to close their positions and lead to a sharp decline in share prices. Most of them are true bad news.” “However, the liquidity of Hong Kong stocks is poor, and the sharp rise and fall of stocks of about 1 yuan are also common,” the person told reporters
Another market analyst believes that Bohai bank has continuously issued fines in recent years, and another 2.8 billion certificates of deposit pledge event has broken out. The sharp decline may be related to the bank’s upcoming performance in 2021.
In this regard, the Chinese reporter of the securities company has tried to contact Bohai bank for many times, but as of the time of issuing the press release of the securities company in China, no reply has been received.
share price plummeted and fell 28% at one time
On March 1, Bohai bank opened at HK $1.31 per share. Shortly after that, the share price suddenly fell sharply. At one time, it fell by more than 28% to HK $0.93 per share, a new low since its listing. Then it made a slight correction and fluctuated around HK $1 per share. As of the close, Bohai Bank fell 23.85% to close at HK $0.99/share.
A Hong Kong stock market analyst told the Chinese reporter of the securities firm that the performance of the sudden collapse of Bohai bank may be that the shares of mortgage financing were sold, resulting in the forced liquidation of the shares. From the share price of Bohai bank, the share price of the Bank fell to HK $1 per share from HK $3 per share at the end of last year.
Earlier, the flash collapse of Bank of Gansu on April Fool’s day in 2020 was also caused by the forced closing of positions by financial institutions. Specifically, at 14:28 p.m. on April 1, 2020, the share price of Bank of Gansu plunged continuously and fell below HK $1 / share. On that day, it finally closed at HK $0.65/share, down 43.48%.
At that time, the Bank of Gansu responded to the Chinese reporter of the securities firm that the reason for the decline in share price was that, on the one hand, Hong Kong stocks such as HSBC Holdings suspended dividend distribution, which led to the overall decline of the Hong Kong stock banking sector; On the other hand, because the relevant shareholders pledged the H shares of Bank of Gansu to financial institutions for financing purposes, the H shares pledged by the relevant shareholders were forcibly sold in order to fulfill the obligations of relevant financing arrangements, resulting in significant fluctuations in stock price and trading volume.
Hong Kong stocks and banks fell generally
In fact, on March 1, Hong Kong stocks and banks generally fell. Among them, led by Bohai bank, Bank of Luzhou fell by more than 7%, Bank of Jiangxi fell by more than 6%, Bank of Guizhou, Jinshang bank and other domestic banks fell by more than 2%, and Standard Chartered Bank and Bank of China Hong Kong also fell by more than 1%.
Affected by the news of the conflict between Russia and Ukraine, Hong Kong stocks and bank stocks have been in the doldrums for several consecutive days. On February 25, Hong Kong bank stocks generally fell at the opening of the day. Bohai Bank fell more than 4%, Standard Chartered group and HSBC Holdings fell nearly 4%, and Industrial And Commercial Bank Of China Limited(601398) fell more than 1%.
A banker familiar with Hong Kong stocks told reporters that in fact, due to poor liquidity, the sharp rise and fall of Hong Kong stocks of about 1 yuan often occur. However, for the speculation that the pledged shares were forcibly closed, the person said, “this situation is relatively rare, and generally there is bad news.”
Another market analyst told reporters that the reason why Bohai bank plunged sharply this time is related to the upcoming annual report of the past 2021.
“Last year, due to the problems of risk control of Bohai bank, the 2.8 billion pledge case occurred, which made the commercial reputation of the whole listed company of Bohai bank questioned by the market.” The source further pointed out that although the asset scale of Bohai bank had exceeded one trillion, there was a lack of innovative ideas in the real business strategy. “The sharp decline in share price should be directly related to the performance of the bank to be announced, but the specific information needs to be further confirmed by the announcement of listed companies.”
Public information shows that Bohai bank is the only newly established national joint-stock commercial bank since the revision of the China Commercial Bank Law in 2003. It is also the first joint-stock bank that has introduced overseas strategic investors and headquartered in Tianjin since 2000.
From the perspective of equity structure, Bohai bank was initiated and established by 7 shareholders of Tianjin TEDA Investment Holding Co., Ltd., Standard Chartered Bank (Hong Kong) Co., Ltd., China Ocean Shipping Group, China Development and investment group, China Baowu iron and Steel Group, Tianjin Trust and Tianjin Shanghui investment (holding) Co., Ltd. It was established on December 30, 2005 and officially opened in February 2006.
The bank’s financial report shows that as of September 30, 2021, Bohai bank has achieved an operating revenue of 22.763 billion yuan; Net profit of RMB 6.056 billion; In the same period, the bank’s capital adequacy ratio was 12.59%, the core Tier-1 capital adequacy ratio was 8.64%, and the Tier-1 capital adequacy ratio was 10.67%.
From the follow-up situation of Chinese banks going to Hong Kong stock market, the motivation is generally insufficient China Everbright Bank Company Limited Co.Ltd(601818) financial market analyst Zhou Maohua pointed out to reporters that the banking sector has been undervalued, and the market is also worried about the bad risk of banks. In addition, the growth of banks is not as good as some other sectors. “Subsequent bank stocks may make investors profit, but there may be greater differentiation between individual stocks.”
deposit pledge case has not been finalized
As a member of the joint-stock bank, Bohai bank has been in constant dispute recently. A “deposit pledge case” staged at the end of 2021 has attracted widespread attention.
In October last year, a pharmaceutical group called Jimin credible issued a document accusing Nanjing Branch of Bohai bank, saying that Shanhe pharmaceutical and Hang Seng pharmaceutical, the subsidiaries of the group, were misappropriated the 2.8 billion yuan deposit deposited in the bank as the loan pledge guarantee of a third-party company without “knowledge”.
One stone aroused thousands of waves, and the news aroused great concern in the banking industry as soon as it came out. In its response to the announcement on October 24 last year, Bohai bank said that it had reported the case to the public security organ and was seeking judicial settlement according to law, and attributed the incident to “abnormal behavior between enterprises found in the process of daily business handling with relevant enterprises”.
Then, jiminxin released six questions about Bohai Bank Nanjing branch again A text. The article mentioned that from the recording provided by jiminxin, it can be confirmed that the group is “unauthorized and unaware” of the pledge. In an interview with China Central Television, Nanjing Branch of Bohai bank said for the first time that in about a year, jiminxin Department received an additional income of three times the bank’s deposit interest from Huaye Petrochemical Department. Other information also showed that “jiminxin is aware of the matter and is not a simple deposit customer it claims to be”.
However, in response to this, jiminxin insisted that the group had no knowledge of the pledge of deposits, and issued an article on “asking Bohai Bank Nanjing branch again” on November 5 to reiterate its position. Both sides do not recognize each other’s caliber.
The case of deposit pledge has also aroused great concern at the regulatory level. On November 12 last year, the International Department of China Securities Regulatory Commission issued a feedback to Bohai bank, requiring Bohai bank to explain in detail the situation and progress of the pledge guarantee provided by the depositor for a third party, and asked whether the relevant employees of the bank had any illegal or improper operation.
On December 7 of the same year, the person in charge of relevant departments of the China Banking and Insurance Regulatory Commission said that for the case of pledge of acceptance bills by third-party certificates of deposit of individual commercial banks, the China Banking and Insurance Regulatory Commission had dispatched a supervision working group for the first time in the early stage to carry out on-site investigation and supervision, and required the head office of the bank involved to enter the relevant branches simultaneously to carry out comprehensive risk investigation on the relevant bill business.
At present, the parties have not updated the relevant progress of the case.
