DBS to Invest $376M to Secure Additional Stake in Shenzhen Rural Commercial Bank

DBS Group Holdings announced a S$376 million (US$284.72 million) increase in its stake in China's Shenzhen Rural Commercial Bank on Dec 29, as it seeks to capitalise on growing opportunities in the Greater China region.

DBS Bank, a subsidiary of Southeast Asia's largest lender, will increase its stake in the unlisted Chinese bank from 13% to 16.69%.

DBS said it will buy 383.6 million shares at RMB5.25 per share and will fund the transaction with internal cash reserves.

Since the beginning of the year, the lender has been in talks with Shenzhen Huaqiang Asset Management Group about acquiring their stake in Shenzhen.

The deal is expected to be immediately accretive to earnings and return on equity, DBS said.