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MSCI adds Shanghai Commercial Bank to global standard indexes

2019/02/12 11:45

Taipei, Feb. 12 (CNA) Global index provider MSCI Inc. has added Taiwan-based Shanghai Commercial & Savings Bank to its MSCI Global Standard Indexes after a quarterly index review.

MSCI announced the addition of the Taiwanese bank to the global standard indexes on its website overnight, and it also noted it was not adding or removing any Taiwanese stocks to or from the MSCI Small Cap Indexes and the MSCI Micro Cap Indexes after the review.

Analysts said the inclusion of Shanghai Bank to the benchmark MSCI Global Standard Indexes was widely expected because of the strong showing of the bank's shares after the company went public on the Taiwan Stock Exchange (TWSE) on Oct. 19, 2018.

It had previously traded on Taiwan's emerging market.

Shanghai Bank's inclusion in the index is expected to improve its visibility in the global market as the global standard indexes are watched closely by foreign institutional investors, analysts said.

In the wake of MSCI's decision, shares of Shanghai Bank were up 2.40 percent at NT$44.85 (US$1.45) as of 10:57 a.m. Tuesday.

The index adjustments are scheduled to take effect after the stock market closes on Feb. 27, MSCI said.

Prior the MSCI move, Shanghai Bank had been added to the FTSE TWSE Taiwan 50 Index, which is jointly compiled and managed by TWSE and global index provider FTSE International Ltd. and comprises the top 50 stocks in terms of market capitalization in Taiwan's market.

As of Monday, Shanghai Bank shares had jumped more than 35 percent from its issue price of NT$32.28 on Oct. 19. On Monday, the stock closed at NT$43.80 to boost its market capitalization to NT$179.67 billion, from NT$132.41 billion when it was first listed.

The bank's IPO, the only stock listing in Taiwan's financial sector in 2018, was the biggest stock issuance of the year in Taiwan.

Shanghai Bank currently operates 69 domestic branches and has three overseas branches and three overseas representative offices.

The bank also owns a subsidiary in Hong Kong, which has 44 branches in the former British territory and four branches in the U.S. and European markets.

In the first nine months of last year, Shanghai Bank posted earnings per share of NT$2.51, up from NT$2.29 over the same period of last year, after registering NT$3.04 in EPS for all of 2017.

Meanwhile, MSCI also decided to include Foxconn Industrial Internet Co. Ltd. (FII), an Internet-based subsidiary of Taiwan-based manufacturing giant Hon Hai Precision Industry Co., to the MSCI Global Standard Indexes after the index review.

FII launched an IPO on the Shanghai Stock Exchange in June 2018. Hon Hai retained an 84.8 percent stake in FII after the listing.

FII's IPO is part of an effort by Hon Hai, also known as Foxconn on the global market, to integrate hardware production with software development capabilities to diversify its operations beyond contract manufacturing.

(By Jeffrey Wu and Frances Huang)Enditem/ls