Social Security Fund Of China Is Still Selling Chinese Banks31 August, 2011, 15:16. Posted by Zarathustra
After Bank of America selling half of the CCB (939.HK) they had, the latest which is selling is the social security fund of China. The target this time is Industrial and Commercial Bank of China(ICBC, 1398.HK).
This is not a huge news. In fact, the Social Security Fund has been selling things for the past few months. In June, we noted that a filing with Hong Kong Stock Exchange revealed that the fund has been selling HK$3.5 billion or more Bank of China (3988.HK), and we noted that they have also been selling ICBC. Yesterday, a regulatory filing shows that the Social Security Fund has sold even more ICBC.
Again, as we have noted last time that the Social Security Fund only file notices to the Stock Exchange only when their holdings in the shares cross a whole percentage point. That means they don’t file anything when their shareholding is falling from, for example, 19.9% to 19.1%, but they file notice when it falls from 19.1% to 18.99%. In the latest filing, they said they have sold 9 million shares of ICBC at HK$4.92 per share. The reality is that since they first filed the reduction of shareholding in March, the fund’s shareholding has been falling from 18.04% to 16%. To be even more precise, they have sold at least 1,775,581,000 shares. Assuming the average selling price is HK$5.5 per share, they have probably sold about HK$10 billion or more worth of ICBC since March.
Together with the disposal of Bank of China as noted before, the Social Security Fund has sold at least HK$3.5 billion worth of Chinese banks shares. The motivation of the disposals are unclear, but whatever the reason is, the message is clear: they have been selling, and they are probably still selling.