OCBC Bank requests trading halt after reports of its bid for HK's Wing Hang Bank

Singapore lender OCBC Bank requested a trading halt on its shares at 10.30am on Monday, pending the release of an announcement.

This follows reports on Friday that the bank has lodged a binding bid for a family-run bank in Hong Kong valued at US$4.6 billion (S$5.8 billion), a deal that would be its biggest-ever acquisition.

Wing Hang Bank, one of four remaining family-owned banks in Hong Kong, has a market value of US$4.6 billion.

OCBC is said to have offered less than the two times book value that Wing Hang was seeking, according to a Bloomberg report which cited anonymous sources.

The bank declined to comment on Friday.

OSKDMG Research analysts said on Monday that the potential acquisition of Wing Hang would "significantly enlarge" OCBC's footprint in Greater China.

More importantly, it would "tie in with OCBC's strategic direction for the region", the brokerage said in a report.

But it added that an acquisition price of two times Wing Hang's book value "is not particularly attractive". The brokerage is maintaining its neutral call on OCBC with a target price of $10.90.

OCBC's share price fell 15 cents, or 1.5 per cent, to $9.87 on Monday before trading in its shares was halted.