Core Viewpoint - Luzhou Bank's large-scale capital increase plan may be aborted due to shareholder objections, leading to the postponement of the proposal for non-public issuance of H-shares [2][3] Group 1: Capital Increase Plan - Luzhou Bank announced a plan to issue up to 1 billion new H-shares, aiming to raise at least HKD 18.5 billion [2][5] - The planned issuance was to be priced at approximately 50% of the bank's projected net asset value per share for 2024, indicating a "below net asset value" capital increase strategy [2][4][5] - The board decided to postpone the proposal to allow management to consider shareholder feedback before resubmitting it for approval [2][3] Group 2: Financial Health and Background - As of the end of last year, Luzhou Bank's total assets exceeded CNY 170 billion, with a core Tier 1 capital adequacy ratio of 8.27%, below the national average of 11% for commercial banks [3][4] - Luzhou Bank, a state-owned enterprise from Sichuan, became the first city-level bank in the western region to be listed on the Hong Kong Stock Exchange at the end of 2018 [3] - The bank's major shareholders include Luzhou Laojiao Group and the Sichuan Jiale Enterprise Group, with state-owned shares accounting for over 51% [3]

Core Viewpoint - Luzhou Bank has decided to postpone the submission of its non-public H-share issuance proposal to the shareholders' meeting, which was originally planned to raise at least HKD 1.85 billion by issuing up to 1 billion new H-shares at a minimum price of HKD 1.85 per share [1][2] Group 1: Shareholder Feedback and Decision - The decision to postpone was influenced by shareholder feedback regarding the non-public issuance proposal, leading the board to reconsider the plan [2][3] - The withdrawn proposals included several special resolutions for the annual shareholders' meeting and the first meetings of domestic and H-share shareholders, resulting in the cancellation of these meetings [2] Group 2: Governance and Future Plans - This situation highlights the importance of shareholder influence in major corporate decisions and reflects the company's governance standards [3] - The postponement is intended to allow management time to adjust the non-public issuance plan based on shareholder concerns, ensuring that future capital plans meet regulatory requirements and stakeholder interests [3] Group 3: Capital Needs and Market Position - Luzhou Bank, a state-owned enterprise, has a total share capital of approximately 2.718 billion shares, with major shareholders including Luzhou Laojiao Group and Sichuan Jiale Enterprise Group [4] - As of the end of 2024, the bank's core Tier 1 capital adequacy ratio was 8.27%, below the national average of 11.00%, indicating a continued need for capital supplementation [4] - The bank has been growing its asset base, reaching RMB 171 billion by the end of 2024, which represents an 8.48% increase from the previous year [4] Group 4: Future Capital Plans - The original plan to issue H-shares aimed to leverage the Hong Kong capital market for financing to enhance core Tier 1 capital and competitive strength [5] - Despite the postponement, the ongoing growth in asset size and relatively low capital adequacy ratio suggest that the need for capital supplementation remains significant [5] - Future capital plans, including potential "broken net issuance" or other strategies, may be revisited when market conditions and shareholder feedback align favorably [5]

Core Viewpoint - Luzhou Bank's large-scale capital increase plan may be aborted due to shareholder objections, leading to the postponement of the proposal for non-public issuance of H-shares [1][3]. Group 1: Capital Increase Plan - Luzhou Bank announced on June 25 that it would delay submitting the proposal for the non-public issuance of up to 1 billion new H-shares to the shareholders' meeting due to shareholder feedback [1][3]. - The original plan aimed to raise at least HKD 1.85 billion (approximately USD 236 million) through the issuance of H-shares, with a proposed issuance price potentially set at half of the bank's net asset value per share for 2024 [1][5][6]. - The bank's board had previously approved the issuance plan during a meeting on April 1, with the intention to discuss it at the upcoming shareholders' meeting [2]. Group 2: Financial Position - As of the end of last year, Luzhou Bank's total assets exceeded RMB 170 billion, and it operates branches in Chengdu, Meishan, and Suining [4]. - The bank's core Tier 1 capital adequacy ratio was reported at 8.27%, which, while meeting regulatory requirements, is significantly below the national average of 11% for commercial banks [5]. Group 3: Market Context - The bank's planned issuance would have marked it as one of the few listed banks outside of state-owned enterprises to utilize a "broken net" issuance method for core Tier 1 capital replenishment [6][7]. - Luzhou Bank is part of a broader trend in Sichuan, where local city commercial banks are undergoing significant equity restructuring, with several banks increasing their state-owned shareholding ratios in recent years [8][9].