Appraise strategies for measurement-management of such risks

Assignment Help Financial Management
Reference no: EM131297379

On 1 April 2014, Singapore’s OCBC Bank announced its offer to acquire all the issued shares of Wing Hang Bank Limited in Hong Kong at a price of HK$125 per share. Wing Hang Bank was the 4th largest mid-sized bank in Hong Kong by gross loans at the time, and its strengths lay in SME, automobile and equipment financing, and mortgage and tax loans. Wing Hang Bank also owned a network of branches both in Macau and mainland China which OCBC Bank had hoped to leverage on to deepen OCBC’s presence in the Greater China region. The acquisition was completed in July at $6.23 billion Singapore Dollars, and on 1 October 2014, Wing Hang Bank was rebranded as OCBC Wing Hang to reflect its integration into the OCBC group. Identify at least four (4) financial risks faced by OCBC Bank group that might be impacted by the acquisition. For each risk, assess the possible impact and appraise strategies for measurement and management of such risks.

Reference no: EM131297379

Questions Cloud

What is new divisor for the price-weighted index : Able, Baker, and Charlie are the only three stocks in an index. The stocks sell for $37, $312, and $94, respectively. If Baker undergoes a 2-for-1 stock split, what is the new divisor for the price-weighted index?
Maintains current relative proportions invested in stock : A fund manager manages a portfolio of mid-cap stocks. She anticipates receiving $30 million in cash four months from today to be invested in the portfolio in a manner that maintains the current relative proportions invested in each stock. what is the..
What is the companys stock price today : A company is expected to pay a dividend of $1.25 three years from now. Once the company initiates the dividend payment, the dividends are expected to grow at a constant rate of 5% per year thereafter. The required return on this company is 10%. What ..
What is the bonds yield to maturity today : Last year a company issued 12-year 10% semiannual coupon bond at its par value of $1000. What is the bond’s yield to maturity today if the bond sells for $1050 now?
Appraise strategies for measurement-management of such risks : On 1 April 2014, Singapore’s OCBC Bank announced its offer to acquire all the issued shares of Wing Hang Bank Limited in Hong Kong at a price of HK$125 per share. Identify at least four (4) financial risks faced by OCBC Bank group that might be impac..
Dividends are expected to grow at a constant rate : A company is expected to pay a dividend of $1.25 three years from now. Once the company initiates the dividend payment, the dividends are expected to grow at a constant rate of 5% per year thereafter. The required return on this company is 10%. What ..
Compute the realised rate of return for investors : Six years ago the Singleton Company sold a 20-year bond issue with a 14 percent annual coupon rate and a 9 percent call premium. Today, Singleton called the bonds. The bonds were originally sold at their face value of $1000. Compute the realised rate..
Portfolio of the two assets has an expected return : Using CAPM. A stock has a beta of 1.15 and an expected return of 10.4 percent. A risk-free asset currently earns 3.8 percent. What is the expected return on a portfolio that is equally invested in the two assets? If a portfolio of the two assets has ..
Manufactures and distributes certain consumer products : Corporation X, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Corporation X had revenues of $500 Millions of USDs and earnings of $125 of Millions of USDs. Estimate the IPO price for Co..

Reviews

Write a Review

Financial Management Questions & Answers

  What is the equivalent annual cost-required rate of return

Champion Bakers uses specialized ovens to bake its bread. One oven costs $840,000 and lasts about 3 years before it needs to be replaced. The annual operating cost per oven is $11,000. What is the equivalent annual cost of an oven if the required rat..

  Compute the t bill discount

T-Bill Discount Newly issued three-month T-bills with a par value of $10,000 sold for $9,700. - Compute the T-bill discount.

  What is the value of one-year futures contract on the index

Suppose that the current level of the Standard & Poor's Index is 1100. The prospective dividend yield on S&P500 stocks is 3%, and the risk-free interest rate is 2%. What is the value of a one-year futures contract on the index?

  Ratio analysis involves analyzing financial statements

Ratio analysis involves analyzing financial statements in order to appraise a firm's financial position and strength. A stock with a beta equal to -1.0 has zero systematic (or market) risk.

  What percentage of the total votes does she control

Betsy Ross owns 927 shares in the Hanson Fabrics Company. There are 15 directors to be elected. 33,500 shares are outstanding. The firm has adopted cumulative voting. How many total votes can be cast? What percentage of the total votes does she contr..

  Should the cemetery business be started

The Yurdone Corporation wants to set up a private cemetery business. According to the CFO, Barry M. Deep, business is “looking up.” As a result, the cemetery project will provide a net cash inflow of $131,000 for the firm during the first year, and t..

  Justification analysis using capital budgeting techniques

Assume that you have received a capital expenditure request for $52,000 for plant equipment and that you are required to do a justification analysis using capital budgeting techniques. The company’s cost of capital is 12% and the equipment (investmen..

  What is the break- even salvage value of the project

Measured in today's pounds using a required rate of return of 14%. What is the break- even salvage value of this project?

  Consumer lending business

Assume that your partner and you are in the consumer lending business. A customer, talking with your partner, is discussing the possibility of obtaining a $10,000 loan for three months. Furthermore, because the money is needed now and is for only thr..

  The difference between the price and par value of

1 the difference between the price and the par value of a zero-coupon bond represents .a taxes payable by the bond

  What is the expected annual return for stock

Demarius owns investment A and 1 share of stock B. The total value of his holdings is 1,547.71 dollars. Investment A is expected to pay annual cash flows to Demarius of 260 dollars per year with the first annual cash flow expected later today and the..

  Create a replacement chain for alternative a

Create a replacement chain for Alternative A. Assume that the cost of replacing A will be $30,000 and that the replacement project will generate cash flows of $10,500 for years 5 through 8.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd