Bank of Hangzhou

Bank of Hangzhou Co. Ltd.
Native name
杭州银行股份有限公司
FormerlyHangzhou City Commercial Bank
Company typePublic
SSE: 600926
IndustryFinancial services
FoundedSeptember 26, 1996 (28 years ago) (1996-09-26)
HeadquartersHangzhou, Zhejiang, China
Key people
Song Jianbin (Chairman)
Yu Liming (President)
Increase CN¥35.02 billion (2023)
Increase CN¥14.38 billion (2023)
Total assetsIncrease CN¥1.84 trillion (2023)
Total equityIncrease CN¥111.29 billion (2023)
OwnersCommonwealth Bank (5.56%) (2023)
Number of employees
13,756 (2023)
Capital ratioTier 1 9.64% (2023)
Websitewww.hzbank.com.cn
Footnotes / references
[1]

Bank of Hangzhou (BOH; Chinese: 杭州银行; pinyin: Hángzhōu Yínháng) is a Chinese joint-stock commercial bank founded in 1996 and headquartered in Hangzhou, Zhejiang.

Background

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Hangzhou City Commercial Bank (HCCB) was founded on 26 September 1996. The bank mostly operated in Zhejiang province.[2]

In April 2005, Commonwealth Bank acquired acquired a 19.9% stake in HCCB for A$100 million. The deal allowed Commonwealth Bank to have representation on the board and would also provide technical support to HCCB.[2][3]

In December 2006, Asian Development Bank (ADB) acquired a 5% stake in HCCB for US$30 million.[4] In 2014, ADB would sell its entire stake to China Life Insurance Company.[5]

In July 2008, HCCB was renamed to Bank of Hangzhou.[6]

BOH has been stated to use a business model similar to Silicon Valley Bank where it caters to the unique financing needs of tech SMEs given Hangzhou's location for tech startups such as the Alibaba Group. In 2009, BOH launched a dedicated subsidiary to finance tech SMEs. In 2010, BOH expanded to Zhongguancun becoming one of the first to support SMEs to raise capital via equity pledge financing on the National Equities Exchange and Quotations. In 2016 BOH launched a specialized technology finance department. In 2021, BOH opened a branch at the Shanghai Science and Technology Innovation Center.[7]

In October 2016, BOH held its initial public offering (IPO) by becoming a publicly listed company on the Shanghai Stock Exchange. The IPO was smaller than its original targeted size and raised 3.8 billion yuan. Commonwealth Bank was prevented from selling its BOH shares for three years until 2019.[2][8]

In March 2022, Commonwealth Bank sold 10% of its stake in BOH for A$1.8 billion to the Hangzhou city government. It's stake was reduced to 5.56% and it earnt a post-tax gain of A$340 million.[2][9] There were concerns that Chinese regulators would deliberately slow regulatory approvals and the release of funds as it took over two years for Commonwealth Bank to get approval to sell its stake in BoComm Life Insurance Company to Mitsui Sumitomo Insurance Group. However the BOH sale only took four months to be approved. It was speculated that geopolitical factors played a role and since the sell was to the Hangzhou city government, it was much easier to approve the process.[10]

References

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  1. ^ "2023 Annual Report" (PDF). Bank of Hangzhou.
  2. ^ a b c d Duan, Siyu (2 March 2022). "Commonwealth Bank of Australia to Sell 10% Stake in China's Bank of Hangzhou for USD1.3 Billion". www.yicaiglobal.com. Archived from the original on 22 June 2024. Retrieved 22 June 2024.
  3. ^ "CBA expands in China". The Sydney Morning Herald. 21 April 2005. Retrieved 22 June 2024.
  4. ^ "ADB acquires 4.99 pct stake in Chinese city bank". www.chinadaily.com.cn. 1 December 2006. Archived from the original on 12 June 2020. Retrieved 22 June 2024.
  5. ^ "Clifford Chance advises ADB on sale of stake in Bank of Hangzhou". Clifford Chance. 8 December 2014. Archived from the original on 5 May 2015. Retrieved 22 June 2024.
  6. ^ "Results Presentation" (PDF). Commonwealth Bank of Australia. 13 August 2008. Archived (PDF) from the original on 15 March 2023. Retrieved 22 June 2024.
  7. ^ Liu, Zongyuan Zoe (28 June 2024). "China's Tech Funders Worry They Could Be the Next Silicon Valley Bank". Foreign Policy. Archived from the original on 16 May 2024. Retrieved 22 June 2024.
  8. ^ Murray, Lisa (12 October 2016). "CBA-backed Bank of Hangzhou scales back IPO". Australian Financial Review. Archived from the original on 22 June 2024. Retrieved 22 June 2024.
  9. ^ Yeates, Clancy (1 March 2022). "CBA sells Chinese bank stake for $1.8b as Asian retreat continues". The Sydney Morning Herald. Archived from the original on 22 February 2024. Retrieved 22 June 2024.
  10. ^ "CBA's speedy $1.8b sale shows China thaw is real". Australian Financial Review. 9 August 2022. Archived from the original on 8 December 2022. Retrieved 22 June 2024.
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