UOB clinches bank merger

UOB clinches bank merger

SINGAPORE (AFP): United Overseas Bank (UOB) has clinched Singapore's biggest bank merger after getting 90 percent shareholder acceptances from a smaller rival, in the process surpassing DBS Bank as the largest domestic lender.

UOB said in a statement issued late Friday that acceptances reached 90.08 percent, just above the 90-percent threshold for UOB to make a compulsory acquisition of the rest of the shares of Overseas Union Bank (OUB).

It added that its S$10 billion (US$5.7 billion) offer had now become "unconditional" in all respects after getting the necessary regulatory approvals.

The merged entity has combined assets of almost S$115 billion ($66 billion), toppling DBS Bank as the biggest bank in the domestic market in terms of assets.

It will also be number one in market capitalization, credit cards and corporate and consumer loans.

DBS Bank however remains the leader in terms of total deposits, the number of branches and automated teller machines. DBS also remains the biggest Singapore bank if its operations in Hong Kong and Southeast Asia are included.

UOB extended until Sept. 17 its deadline for the rest of the shareholders to accept its cash and share offer.

The statement was issued several hours after the markets closed on Friday afternoon after rumors had swept the market that it was struggling to get the 90-percent level of acceptances.

With the merger between Oversea-Chinese Banking Corp. (OCBC) and Keppel Capital Holdings already in the bag, the number of Singapore banks now has been reduced from five to three.

Singapore has been encouraging its banks to merge so that they can compete better with bigger foreign banks.