Subject: Deutsche Bank receives offer for China bank stake: sources - Yahoo News
From: "Eric Schwerin" <[email-masked]>
To: "Hunter Biden" <[email-masked]>
Date: Thu, 23 Apr 2015 12:11:14 -0400

> http://news.yahoo.com/deutsche-bank-receives-offer-china-bank-stake-sources-154651441--sector.html <http://news.yahoo.com/deutsche-bank-receives-offer-china-bank-stake-sources-154651441--sector.html>
> 
> Deutsche Bank receives offer for China bank stake: sources
> 
> By Denny Thomas
> 
> HONG KONG (Reuters) - Deutsche Bank has received at least one offer from a Chinese financial institution to buy the German bank's 20 percent stake in Hua Xia Bank <600015.SS>, though a deal is not within reach yet, sources familiar with the matter told Reuters.
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> Deutsche is considering selling the Chinese bank stake, which is valued at about $4.8 billion, although no final decision on a potential divestment has been taken, the sources said, declining to be identified as the discussions are confidential.
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> Seven years after the financial crisis, Germany's flagship bank is looking to overhaul its business after failing to meet its return-on-equity targets and having to deal with a string of regulatory fines and legal challenges.
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> Deutsche is expected to reveal details of a major revamp on Friday and is preparing to sell the Postbank retail banking chain it owns and potentially some of its foreign retail banking activities.
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> Deutsche Bank declined to comment on a possible Hua Xia stake sale.
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> Deutsche Bank first acquired a stake in Hua Xia, which has $24 billion market value, in 2006, later raising it to the maximum permissible 19.99 percent allowed under Chinese rules.
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> A senior Asia-based source, who has direct knowledge of the matter, said Deutsche had received some bids, though there was no decision yet. The source declined to name the potential bidders.
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> The stake could be attractive to Chinese insurers or to fund managers, other M&A bankers said.
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> Deutsche could also jettison the stake by selling the shares in the open market, although such large block trade could be difficult to execute as 80 percent of mainland stock market activity is controlled by retail investors.
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> If Deutsche decides to exit, it would join a long list of foreign banks which have totally cut or trimmed their China bank investments.
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> European and U.S. banks bought strategic stakes in Chinese state-owned banks ahead of their stock market listings. But in reality, most of these strategic partnerships have turned into financial investments, and foreign banks have ended up cashing them in. Hua Xia's shares have nearly doubled in the past year.
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> One senior banker said Deutsche Bank might even decide to keep its stake as a door opener to the Chinese market.
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> "Of course, it is on the list of potential divestments. But will they really do it? I don't know," he said.
> 
> (additional reporting by Arno Schuetze; editing by Thomas Atkins and Jane Merriman)
> 

Eric D. Schwerin
Rosemont Seneca Partners, LLC
1010 Wisconsin Ave., NW
Suite 705
Washington, DC 20007
(202) 333-1880
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