Its market cap surges to $34.2b, $1.7b more than DBS's $32.5b
By SIOW LI SEN
OCBC Bank has overtaken DBS as the largest bank in South-east Asia in terms of market capitalisation, as analysts rerated the stock following its strong third-quarter results. Yesterday, OCBC continued its juggernaut run, ending 31 cents higher at $10.24, giving it a market capitalisation of $34.2 billion, $1.7 billion more than DBS's $32.5 billion. It is $5.3 billion ahead of United Overseas Bank's market cap of $28.9 billion.
Interestingly, OCBC had been trailing UOB - until August. By Sept 15, its market cap had became decisively bigger to claim the No 2 position. OCBC has left DBS in its dust since Monday as investors charge into the stock after analysts noted that the bank had posted the best operating results.
OCBC's stock price is now up 12.5 per cent year-to- date while DBS's and UOB's are in negative territory, down 8.6 per cent and 6.1 per cent respectively.
In a Nov 10 note, Nomura said that OCBC chief executive David Conner spent three days meeting clients in the UK last week, to an overwhelmingly positive response.
'Solid Q3 results were a peer-differentiating tailwind that allowed David to focus on the qualitative element underpinning the success in deepening the group's Asean platform such that OCBC is now the fastest growing, most product-diversified Sing banking group, the largest, most profitable foreign bank in Malaysia and a top 10 bank in Indonesia.'
It also has the 'fastest growing loan book and fee income, (both quarter-on-quarter and year-on-year) and most products - commercial bank, investment bank, life insurance and private banking', said Nomura analyst Anand Pathmakanthan.
DBS and UOB also reported better-than-expected Q3 results but analysts say that they are impressed with OCBC's management which has shown that it can deliver. 'In our view, the stars are aligned for OCBC's share price to be rerated further,' said Ng Wee Siang, BNP Paribas analyst. Earlier concern over its acquisition of ING Asia Private Bank has dissipated and the much feared staff exodus proved unfounded, he said. The acquisition has actually bulked up its private banking business and filled in the product gaps, putting OCBC in an enviable position to better compete with larger peers.
