08.08.2001
ABN AMRO eyeing Grand Commercial?

• Development: ABN AMRO is looking to acquire a Taiwanese bank(s). Local press reported that Grand Commercial Bank is a possible target. ABN hopes to facilitate a cross holding through asset swap. ABN AMRO is presently negotiating purchase price and ownership structure.

• Analysis: Grand Commercial is working hard to improve asset quality through aggressive bad debt write-off. The bank’s overdue loan ratio in 2Q01 is down to 2.9% from 3.8% in 1Q01. We believe the decline is in preparation for a M&A.

• Primasia View: Investors should beware of a volatile stock price. This is the second time the shares have moved up due to M&A speculation.