The team from law firm Sidley advised on one of the largest initial public offering's in Asia this year.
Guangzhou Rural Commercial Bank (GRCB) shares were higher in their debut trading, in line with market expectations for Hong Kong’s largest new listing.
GRCB is China's fifth-largest rural commercial bank by assets. The total offering amount was approximately $1 billion, making it one of the largest Hong Kong IPO's in 2017.
Beijing and Hong Kong
Sidley acted as the legal advisor to the joint sponsors and underwriters in the global offering of GRCB on the Stock Exchange of Hong Kong.
The Sidley team was led by partner Mengyu Lu from the Beijing office, as well as partner Carrie Li from the Hong Kong office, with support from Hong Kong-based counsel Mandy Wong, senior legal manager Linda Ruan, and associates in China and Hong Kong.
Largest This Year
The listing size surpassed the $511 million raised by WuXi Biologics (Cayman) earlier in June and is the biggest since China Postal Savings Bank raised $7.32 billion on the Hong Kong bourse last year.
Guangzhou Rural’s total assets were worth $97 billion at the end of 2016.
Liquidity Strain
The Chinese banking sector faces several challenges this year, as the regulatory crackdown to reduce financial leverage will cause a liquidity strain on the already stretched banking system.
Rural commercial banks may be hit harder by tighter liquidity more than the country's larger lenders, as they tend to have higher leverage and interbank borrowing costs.
