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OCBC buildings sale expected to net $130m
BEN WILMOT AND SARAH DANCLERT THE AUSTRALIAN SEPTEMBER 04, 2014 12:00AM

THREE buildings linked with Singapore’s Overseas-Chinese Banking Corporation — two in Melbourne and one in Sydney — are coming to market and are ­expected to sell for more than $130 million in total.

The former OCBC House at 565 Bourke Street in Melbourne’s CBD, which comprises a five-storey brick office block built in 1902 and a more modern 16-storey building completed in 1990, is expected to garner about $80m.

Shakespeare Property Group picked up the asset for about $53m in 2011.

CBRE’s Mark Coster, Mark Granter and Mark Wizel are selling the complex. The property is tipped to generate strong ­interest from local private investors and offshore groups from Europe and Asia.

Mr Coster said the decision to sell followed a significant ­refurbishment of the building, which had helped retain tenants including Lumo Energy, Civica, Ridley Corporation and Thomson Reuters, as well as state and federal government tenants.

In total, the two buildings cover 15,926sq m of office space above a 65-space, two-level basement car park.

In Sydney, Eastern Holdings has called for submissions to sell a $50m-plus property occupied by Overseas-Chinese Banking Corporation.

The 11-storey building at 73-75 Castlereagh Street has a net lettable area of 7020sq m. Agents are yet to be selected for the sale.

Eastern Holdings bought the building for $16m in 1994. The property was completed eight years earlier on the site of the ­former Mayfair Theatre.

Vested in OCBC. If I think OCBC is a good buy at around $9, I think it is still a good buy at $7.65.

How many of you would be subscribing for excess rights at $7.65 per share?

^ you heard of the 'tragedy of the commons' concept?

HI OPMI,

Would like to hear your application of the concept to the reits application.

Care to share? =)

(12-09-2014, 09:57 AM)opmi Wrote: [ -> ]^ you heard of the 'tragedy of the commons' concept?

(12-09-2014, 11:35 AM)flinger Wrote: [ -> ]HI OPMI,

Would like to hear your application of the concept to the reits application.

Care to share? =)

(12-09-2014, 09:57 AM)opmi Wrote: [ -> ]^ you heard of the 'tragedy of the commons' concept?

Was referring to Ocbc rights application. Nothing to do with REITs.


Sent from my iPhone using Tapatalk

Hi OPMI,

I was referring to the rights application as well, mistakenly type Reits .

would still like to hear your application of the concept to the rights.

(12-09-2014, 11:43 AM)opmi Wrote: [ -> ]

(12-09-2014, 11:35 AM)flinger Wrote: [ -> ]HI OPMI,

Would like to hear your application of the concept to the reits application.

Care to share? =)

(12-09-2014, 09:57 AM)opmi Wrote: [ -> ]^ you heard of the 'tragedy of the commons' concept?

Was referring to Ocbc rights application. Nothing to do with REITs.


Sent from my iPhone using Tapatalk

(12-09-2014, 09:41 AM)investor101 Wrote: [ -> ]Vested in OCBC. If I think OCBC is a good buy at around $9, I think it is still a good buy at $7.65.

How many of you would be subscribing for excess rights at $7.65 per share?

i think at 7.65 is a quite a good buy now of course.
Not vested.

(12-09-2014, 09:57 AM)opmi Wrote: [ -> ]^ you heard of the 'tragedy of the commons' concept?

Yeah. But how does subscribing to excess rights hurt the everyone's interest by depleting a good resource?

Can only get excess rights if enough people reject the rights issue.

Almost everyone I know who owns OCBC share has applied for excess Rights, myself included.
But end of the day I guess not many will get it.
Those who get it will be like striking Consolation prize in 4D .

http://www.businesstimes.com.sg/premium/...f-20140924

PUBLISHED SEPTEMBER 24, 2014
Bank CEOs have to juggle smart, says OCBC chief
They must manage stakeholders and compliance issues, among other things

BYSIOW LI SEN
lisen@sph.com.sg @SiowLiSenBT

Asian banks have it better: OCBC chief Samuel Tsien said that due to the sustained growth in Asian economies, Asia banks avoided the painful process of having to deleverage during the financial crisis.
Yolande Barnes, director, Savills World Research
[SINGAPORE] The chief executive of OCBC has likened the running of a bank to being a juggler.
Samuel Tsien, speaking in Hong Kong at a banking conference on Tuesday, said the bankers of today do not only have to meet the expectations of their immediate stakeholders in the delivery of services and in results, they must also pay attention to the increasingly-strident demands of communities, netizens and politicians.
Bankers thus "have to reshape the bank's organisational culture to meet the highest demands of trust, honesty and integrity, fair dealing, corporate governance and social responsibility", he said.
Add to this the jump in number of regulations since the 2008 global financial crisis (GFC), compliance with which runs up costs. Because not all such costs can be passed on to customers, shareholders might get hit in the form of reduced returns, he said.
And related to compliance with the new battery of rules is the trend towards in-sourcing aspects of operations, because cross-border out-sourcing creates difficulty in supervision.
In OCBC alone, there has been a more than 35 per cent growth in resources channelled towards control and compliance work each year since the GRC, he said.
Referring to the task of tackling all these demands competing for the attention of top bankers, he said: "This is not easy, and only a smart juggler can do it."
He added that banks have seen the rise of what is effectively "de-globalisation", given the rise of greater ring-fencing of local liquidity, local incorporation and subsidiarisation of retail operations.
There are sound reasons for such practices, because some otherwise-healthy domestic financial systems had come under threat during the GFC, he said.
Of bank customers, he said they now have "zero tolerance" for service disruptions, and along with regulators, have no tolerance for the compromising of data confidentiality.
"Further, with the pervasive multiplier effect of social media these days, banks are exposed to much higher reputational risks; public sentiment regarding any such incidents can be influenced through carefully-framed and sometimes malicious social media postings.
"What starts off as a blip that could dent a bank's reputation can quickly escalate into a full-blown crisis, with enormous financial and regulatory impacts," he said.
Mr Tsien thus had this one question to ask: "Is banking therefore at risk of becoming an unattractive business to invest in from a returns perspective?"
A study of the world's 200 biggest banks by EY found that the average return on equity (ROE) in 2013 was only 9.74 per cent, marginally above the average cost of equity.
"To achieve the typical bank management's target ROE of 12 to 15 per cent, the average bank would have to cut costs by as much as 65 per cent - or increase revenues by 40 per cent," he said.
He added, however, that the lower returns on capital have, fortunately, not dealt Asian banks too hard a blow:
"Due to the sustained growth in our real economies throughout Asia (including China), banks in Asia have generally been able to avoid the painful process of deleveraging during the GFC, and have continued to generate adequate returns for their shareholders."
OCBC achieved a healthy annualised ROE of 14 per cent for the first half of this year, he said.
"Nevertheless, the challenge of depressed banking returns will continue to intensify, potentially reducing capital flows to the sector. This in turn could curtail the ability of banks to play the vital role of financial intermediary for society," he said.